Banking

Indonesia’s banking sector is large and crowded, with more than 1600 licensed commercial and rural banks. However, there remains plenty of untapped potential, given that the country has the fourth-largest unbanked population worldwide, at 83.1m people as of November 2019. Policymakers want both the number of banks and the unbanked population to shrink. As more Indonesians join the formal financial sector, it is expected that banks will consolidate, thanks to increased foreign investment and mergers. Regulators have been relaxing rules in hopes of attracting foreign entities that are keen to buy banks and create bigger players in the process. This chapter contains interviews with Jahja Setiaatmadja, President Director, Bank Central Asia; and Batara Sianturi, CEO, Citi Indonesia, and Chairperson, International Banks Association of Indonesia.