REPUBLIKA.CO.ID, JAKARTA -- Infrastructure financing requires a long-term funds because the development cannot be completed in a short-term. The Financial Service Authority (OJK) data recorded 3,835 trillion IDR of third party fund (TPF) in banking industry, consisted of 912 trillion IDR of deposits (giro), 1,167 trillion IDR of savings and 1,756 trillion IDR of time deposits.
The time deposits are the most appropriate funding for infrastructure development in Indonesia. However, majority of today's time deposits tenured one month or 1,012 trillion IDR, while 3-month deposits of 373 trillion IDR, 6-month deposits of 177 trillion IDR and 12-month deposits are only 189 trillion IDR. OJK chairman, Muliaman D Hadad said that the development financing dependence on banking industry should be reduced.
"Bankers have to work hard how to change a short-term financing to be a long-term financing. It needs more efforts," Hadad said recently.
Indonesia needs other financing sources outside banking industry. OJK encourages participation of other financial industries, such as insurance and pension funds. Indonesia's capital market can be a long-term financing sources. Indonesia only has 400,000 local investors, while there are 400 listed companies in capital market.
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