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itri Senayu, owner of Kenari Hijab, an Islamic dress shop in Royal Plaza, Surabaya, East Java, has never received any information on how Islamic finance works during her five years as a hijab seller.

“I use a conventional bank for every transaction I make, because many of my customers also subscribe to it,” said Fitri, whose business generates around Rp 110 million (US$8,424) in gross income per month.

Similarly, a small and medium enterprise (SME) business player from Blitar, East Java, Atik Hidayah says she is reluctant to engage in any financial activity involving sharia banks because of their limited network.

“Sharia banks’ ATMs are only available in the city center, while there are BRI and Bank Jatim ATMs near my house, which is located far from Blitar’s city center,” said Atik, who owns a fried meatball cracker stall that monthly generates no less than Rp 9 million.

Fitri and Atik are just two out of millions of SME owners with little information on Islamic finance. In East Java, sharia banks’ assets account for 4.5 to 4.8 percent of overall banking assets there, similar to sharia lenders’ market share nationwide. Islamic financing reached Rp 24.3 trillion in East Java, of which 26 percent were distributed to SMEs.

This reality made financial authorities and the government reiterate a fresh pledge at the 3rd Indonesia Sharia Economic Festival (ISEF) in Surabaya last week, in which high-ranking officials said they were preparing to establish the National Committee of Sharia Finance (KNKS) that would be directly chaired by President Joko “Jokowi” Widodo.

The high-ranking officials in attendance included the Bank Indonesia (BI) governor, Financial Service Authority (OJK) chairman, ministers from the Finance Ministry, National Development Planning Agency (Bappenas), Religious Ministry, SME and Cooperatives Ministry, as well as representatives from the Indonesian Ulema Council (MUI). “We were discussing about the KNKS and possible problems that have hindered the sharia industry from growing. We discussed human resources, management, and all the things we can do in the future to boost the industry,” Finance Minister Sri Mulyani Indrawati said on the sidelines of the event.

Meanwhile, Bank Indonesia Governor Agus Martowardjo noted that human resources quality would determine the success of the KNKS, including its system and management’s regulation.

“There should be something we need to do to boost stakeholders’ confidence in Islamic financing schemes,” Agus said, adding that the committee would be established this month.

The involvement of 22,000 Islamic boarding schools across the archipelago could be pivotal to address economic financing, including by synchronizing the concept to their curriculum, Agus said.

“Later, every Islamic boarding school graduate is expected to not only become knowledgeable in religious affairs, but also become more independent and understand better about sharia economics, as well as developing their entrepreneurship skills,” he added.

Millions of santri (Islamic boarding school students) could become the backbone of the introduction of sharia economy concepts to the public, said BI director for the policy and payment system supervisory department Punky P. Wibowo. (fac)