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banking provisions related to management of risk concentration, governance or guidance of new
products and activities, where all are expected to strengthen the resilience of sharia banking. BI in
year 2013 will start conducting revision process of sharia banking blue print, and contributing
in the formulation of Indonesia’s sharia inancial architecture, which result is expected to be
the guidelines for OJK, BI or other institutions in developing Indonesia’s sharia inance and
banking.
d. Enhancement of Synergy with Parent Bank by Still Developing Institutional Infrastructure of
Sharia Business Institution Strategy of synergy cooperation between parent
conventional banks with sharia banks has been launched by BI in the policy direction of sharia
banking year 2011, and reinforced in year 2012, namely by the organizing of Sharia Banking
Communication Forum FKPS which was a forum between management of sharia banking and
Sharia Banking Section of BI in mid 2012. In FKPS 2012 board of directors of conventional
commercial banks that own sharia commercial banks were also invited in order to reinstate
commitment of parent banks in the development of their sharia businesses. Through conirmation
of such commitment and strategy as well as policy direction sharia banking it is expected to
align their service levels better with their parent conventional commercial banks BUK among
others through the cooperation in using facilities of technology, oice networks, and SDM.
e. Enhancement of Education and Communitation by Continue Motivating the Improvement of
Sharia Banking Capacity in Productive Sector and also Parity and Distinctiveness Communication of
Sharia Banking Product
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In the last couple of years, the number of sharia banking customers was increasing quite
signiicantly. This indicates a growing number of people who knows and experiences the
beneits from the existence of sharia banking. Bank Indonesia, in its efort to develop sharia
banking, always supports public education and socialization program concerning sharia banking.
For that efort, Bank Indonesia even has gained international award as the Best Central Bank in
Promoting Islamic Banking. In year 2013, socialization and education of sharia
banking will be focused on the beneit of products and agreement of sharia banking, emphasizing
on parity and distinctiveness of sharia banking products. Such program shall be implemented
through various media considered efective in motivating the use of sharia banking services, as
follows: • Community-based socialization through
various events or media such as radio, micro-site and talkshow with a theme of
enhancement of sharia banking productive sector capacity such as: program of
entrepreneurship training for college students and general public, and socialization
of “credit scheme for novice entrepreneurs start-up credit”. Apart from that, there will be
socialization based on community through various events or media such as radio,
micro-site and talkshow, in accordance with target of iB communication segment, i.e.
young community and womenfamilies, entrepreneursprofessionals, academicians,
Islamic scholarsIslamic seminariansreligious leaders and netizens, to be put forward in
various education activities among others equality of technology behind iB facilities and
inancial planning through iB. Particularly for academicians and Islamic scholars segments,
education conducted is through a pattern of
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training for trainers in various regions. • Sharia banking participation in exhibitions
expo to bring general public closer to sharia bank products according to their needs,
among others expo related to productive sectors such as construction, maritime,
mining, agriculture, plantation, electronics, tourism, automotive and creative industry.
Implementation of such programs in the region will be facilitated by a format of “iB
pavillion” with expoexhibition entry points in the ields previously entered such as in
the sector of property, MSMEs, electronics, automotive, and franchise. Such iB campaign
activities are directed to be jointly conducted with sharia banking in a budget sharing
way to develop togetherness in the industry development and also coopetition among
sharia banks and between sharia and the parent banks.
• Dialogue with sharia bank stakeholders management of sharia banks, industry
professional associations, regional governments, academicians, media,
economists and banking observers, community organizations is conducted
to introduce and align views toward sharia banking and at once to facilitate sharia
banking in improving services and also to encourage product innovation co-creation.
• Business gathering, focus group
discussion dan business matching to bring sharia banking closer to
prospective customers whether small- scale, medium, or big. These activities
are also intended to further motivate the realization of cooperation activating
transaction between sharia banking with entrepreneurs.
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• Program of “reinvent the heritage” is to strengthen basic cultural sharia banking
which has uniqueness in the form of proit sharing principle.
• Program of cooperation with The International Centre for Development
in Islamic Finance – Lembaga Pengembangan Perbankan Indonesia
ICDIF-LPPI in providing training and education to sharia banking SDM in order
to improve skills competency operational techniques as well as analysis ability in
marketing sharia banking products based on prudential and sharia compliance.
• Program of Sharia Banking Group WGPS In accordance with the priority of industry needs
or society of sharia banking customers, discussion on WGPS TA 2013 covers at least four 4 main
topics related to sharia banking operations, planned as follows:
DISCUSSION TOPIC PLAN SCHEDULE PLAN
a. Reinancing and Securitization
of Sharia Bank Assets First Semester
b. Islamic Commercial Deposit Mudharabah Muqayyadah
Deposits Certiicates c.
Non Ready Stock iB KPR Sharia Financing of Indent KPR
Second Semester d. Financing of Musyarakah
Syirkah Syndicate
H. Development of Rural Bank
Policy of Rural Bank development remains directed to the strengthening of Rural Bank industry capacity in order to
be able to compete with other business people in micro inancial market, and also to maintain continuity of Rural
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Bank business. Increase of outreach and quality of Rural Bank services becomes one of the focuses of Rural Bank
development eforts. To realize those eforts, BI conducts several policy measures, including:
1. Formulation of Rural Bank Business Model
Rural Bank Business Model shall be formulated through observation phase toward the performace
and behavior of Rural Bank industry in the last 5 years. From the result of observation, then Rural Banks who
have better performance compared to other Rural Banks and which businesses increasing signiicantly
would be selected. The selected Rural Banks will become business model in the management of Rural
Banks. Aspects presented in the business model shall become reference for the establishment of new Rural
Banks or the management of Rural Banks already in operations so that they can run a sound Rural Bank
business. The launching of Rural Bank Business Model book has been conducted by the Governor of Bank
Indonesia GBI on 5 December 2011 in Jakarta. This is a part of BI policy to encourage an establishment
of Rural Bank that is sound, sustainable and able to contribute in the development of regional economy.
Rural Bank Business Model consists of 6 main aspects, most inluencing to Rural Bank business as follows:
a. Owner
A Rural Bank owner ideally should come from the region where the Bank will be established,
has ability and commitment in supplying capital, and also sincerity in promoting a sound Bank
management.
b. Capital Availability of additional capital required for
maintaining continuity of the Rural Bank operations.
c. Location and Operational Areas Establishment of Rural Banks requires
consideration of the location factor by taking into account the economic potential and the
number of banks in that location. Besides, any Rural Bank location should be easily reached by
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low income people especially in rural areas and Micro and Small Enterprises SMEs which are their
customers. d. Business Strategy
In order that Rural Bank business continues growing and developing, Rural Bank management
must have appropriate Business Strategies, such as:
• Focus on the inancing of micro and small-
scale productive business which characters already known, and also on the setting of
competitive and afordable interest rates. • Serve the needs of MSMEs by establishing
requirements as well as a simple and fast bank procedure. Utilize Information Technology IT
supports so as to be able to improve service quality which is much faster and eicient.
• Add oice network in accordance with the needs.
e. Management and SDM Policy Rural Banks must be managed by SDM that have
high integrity, professional, and an understanding toward business potential, and also characteristics
of the region and communities markets to be served by Rural Banks. Employees should come
from the region of where the Rural Banks located as they should understand better the custom,
culture, characteristic of the local people including potency of the region.
Figure 5 - Minimum Standard of Rural Bank Organization Structure
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f. Relationships with the Community Although Rural Banks are business oriented, it
should still mix with and become parts of the local community. This is crucial in building relationship
and inner bond through the involvement of Rural Banks in the community social activities in the
neighbourhood, e.g. religious feasts, festivities and customers’ celebrations.
2. Encourage the Cooperation of Rural Bank Apex
a. An Apex institution is a form of cooperation between Commercial Bank in the role of a parent
patron bank with Rural Banks as the members. The presence of Apex Institution is an ideal synergy
in order to jointly provide services to MSMEs, so as to minimize unhealthy business competitions
between Commercial Banks and Rural Banks. The terminology of Apex itself is taken from Greek
which means “patronprotector” which also means that Rural Bank Apex must become the
patron for its Rural Banks’ members.
b. In general a Rural Bank Apex can function to: i manage pooling of funds and help Rural Banks
in solving liquidity problems due to mismatch; ii conduct joint inancing such as linkage program;
iii conduct technical assistant in the form of information technology development, product
development, training, and payment system service; and iv facilitate Rural Banks in inding
other fund sources.
c. Several reasons a commercial Bank is selected to be a Rural Bank Apex, i.e.: i capable of running
Apex functions especially which related to the provision of facilitiesaccess to payment system;
ii has a superior managerial ability in fund management, iii owns a relatively large capital
back-up, and iv has complete instruments in the management of funds collected.
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d. A Rural Bank Apex Model is developed by BI in the Book: Generic Model – Rural Bank Apex
which contains general guidelines in initiating the formulation and implementation of Rural Bank
Apex operations. The Generic Model – Rural Bank Apex Book is intended to be the guidelines in
formulating and implementing Rural Bank Apex for a BPD acting as Apex, which is a follow-up of
BRC launching program. In relation to this matter, BPD role shall continue to be improved to become
the agent of regional development, where one of its criteria is for BPD to become a Rural Bank Apex.
e. Apex organization consists of 3 main parts, namely: i commercial banks as Apex, which
preparing infrastructures supporting the implementation of Apex operations, such as
setting up units or work units, branch oices to serve Apex members, implementer SDM, SOP, and
information technology; ii Rural Banks as Apex members; and iii Apex Committee consisting
members of Commercial Bank representatives, regional administration council of Perbarindo,
and commisariate administration council of Perbarindo.
f. Beneits of Apex can be experienced by both parties. For the Commercial Bank Rural Bank
Apex, i making Rural Bank oice networks as the long arm
of the Commercial Bank to serve areas and communities that have not
been served, among others through linkage program; ii creating joint products and services
to reach and serve more extensive customers; iii utilizing pooling funds idle funds of Rural
Banks as managed fund sources; and iv having opportunities to generate fee based income
from the utilization of transaction by Rural Banks through ATM network of the Commercial Bank.
The beneit obtained by Rural Banks members
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of Rural Bank Apex among others: i having a patron institution that can provide inancial
support especially in mismatch condition or technical assistance to Rural Banks; ii making
Apex as the institution that provide services on payment system particularly in the context of
transferring funds between customers of Rural Banks members of Apex; iii cooperating in the
utilization of IT-based productsservices such as ATM and marketing of other productsservices;
and iv obtaining other services from Apex in the context of development of Rural Banks, such as
mentoring and training competency building.
Figure 6 – Apex Cooperation Model of Rural Bank
g. Formulation and Development of BPR Apex institutions formed on the basis of agreement
between Commercial Bank that become Apex Patron and Rural Banks as members represented
by Rural Banks’ association caretakers in the regions Perbarindo DPD. Up to today 6 Rural Bank
Apex institutions have been formed consisting of 5 BPD and 1 commercial bank. Development of
Rural Bank Apex institutions are also in line with the program of BRC BPD Regional Champion.
