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Opportunities and strategies for the Indonesian banking sector
The banking sector remains resilient despite increasingly volatile global economic dynamics, though this stability requires constant vigilance and adaptive strategies.
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A buyer pays his bill using Quick Response Indonesia Standard (QRIS) code at a street foodstall on Jl. Ampera Raya in South Jakarta on Feb. 6, 2021. (Antara/Reno Esnir)
I
ndonesia's banking sector faces an unprecedented convergence of global economic trends, technological disruption and emerging opportunities in 2025. The financial services sector maintains a cautiously optimistic outlook despite mounting global economic pressures that have fundamentally altered the operating environment for banks.
The sector remains resilient despite increasingly volatile global economic dynamics, though this stability requires constant vigilance and adaptive strategies.
The OECD's downward revision of global economic growth projections to 3.1 percent in 2025 and 3 percent in 2026, attributed to rising trade barriers and policy uncertainties, has prompted Indonesian financial institutions to recalibrate their risk assessment frameworks.
This revision reflects a broader recognition that traditional economic models may be insufficient for navigating the current environment of heightened protectionism and geopolitical fragmentation.
Banks have responded by diversifying their exposure portfolios and strengthening their capital buffers to withstand potential external shocks. As trade protectionism escalates, particularly from major economies like the United States, Indonesian financial institutions need to develop a comprehensive strategy to maintain resilience while capitalizing on new market dynamics.
There are at least three strategies to respond to the issues, namely traditional monetary policy coordination, innovative Islamic finance mechanisms and digital payment systems diplomacy.
