REPUBLIKA.CO.ID, JAKARTA - Contribution of depositor funds in Islamic banking drops from 84 percen to 78 percent. It also happens to Islamic Business Unit (UUS) and Regional Development Bank (BPD) cuts from four percent to three percent until July 2013.

Executive Director of Islamic Banking at Bank Indonesia (BI), Edy Setiadi said the decline was due to tight regulation of national banking in 2012. Not only the depositor funds, the volume of asset in Islamic banking also declines, from 80 percent to 75 percent, even it is not as drastic as to deposits.

"However, the percentage of deposit to saving fund in UUS and BPD increases from 12 percent to 20 percent," Setiadi said on Thursday. 

Setiadi encouraged Islamic banking to target low cost fund in order to increase deposits. In the last three years, from 2011 to 2013, proportion of low cost fund haven't changed. Deposits in Islamic banking still dominated at 61 percent, while deposits of conventional banking dropped 30 percent. Islamic banks can increase its market share by targeting  fund management in Ministry of Religious Affairs, Islamic based schools, as well as sharia hotel and sharia travel.

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