Bank Indonesia Research Articles

The Legal Position of the Indonesian Ulema Council in Applying the Principles of Islamic Law in Islamic Banking Operations in Indonesia

National economic development through the establishment of Islamic Banks is an implementation of Article 29 of the 1945 Constitution of the Republic of Indonesia. The presence of Islamic Banking in the national economy is a strategic legal policy of the government because its operations are based on the principles of Islamic law, namely principles derived from the Qur'an, Hadith, Ijma', and Qiyas. However, in its application, these principles of Islamic law are manifested in the form of fatwas issued by the National Sharia Council-Indonesian Ulema Council (DSN-MUI) as a source of positive law for Islamic banking. Therefore, this study raises legal issues related to the legal position of the Indonesian Ulema Council in the application of sharia principles to Islamic Banking operations in Indonesia. This study aims to analyze and determine the legal position of the Indonesian Ulema Council in the application of sharia principles to Islamic Banking in Indonesia. The research method used is normative research, which provides answers to the problems raised with the perspective of what should be done. The results of the study indicate that the DSN-MUI fatwa has a crucial role as a positive legal basis in the operation of Islamic Banking in Indonesia, although formally it is not a statutory regulation. The implications of this study indicate the importance of recognizing and strengthening the role of the DSN-MUI in the national legal system to ensure compliance of Islamic Banking operations with applicable sharia principles.

Analysis of the Impact of Mobile Banking Technology, Fintech, and Digital Transaction Security on Customer Loyalty at BUMN Banks in Indonesia

This study investigates the impact of mobile banking technology, fintech innovations, and digital transaction security on customer loyalty at state-owned banks in Indonesia. Utilizing a quantitative approach, data were collected from 300 respondents through a structured questionnaire with a Likert scale ranging from 1 (Strongly Disagree) to 5 (Strongly Agree). The data were analyzed using SPSS version 25, employing descriptive statistics, reliability analysis, exploratory factor analysis, correlation analysis, and multiple regression analysis. The results revealed that all three independent variables—mobile banking technology, fintech innovations, and digital transaction security—positively and significantly influence customer loyalty. Mobile banking technology had a correlation coefficient of 0.62, fintech innovations 0.57, and digital transaction security 0.68 with customer loyalty. The regression analysis showed that these factors collectively explained 38% of the variance in customer loyalty, with digital transaction security having the strongest impact. The findings underscore the importance of enhancing technological capabilities and security measures to foster customer loyalty in state-owned banks. The study provides valuable insights for banking institutions seeking to improve customer satisfaction and retention through advanced technological solutions and robust security protocols.

Factors Affecting Profitability (Study On State-Owned Banks In Indonesia)

The research aims to determine the effect of Capital Adequacy Ratio, Non-Performing Loans, Loan to Deposit Ratio and Net Interest Margin on profitability as measured by ROA. The study was conducted at banks owned by the Government of the Republic of Indonesia or known as Bank BUMN (State-Owned Enterprises) which consists of four banks, namely Bank Mandiri (Bank Mandiri), Bank Rakyat Indonesia (BRI), Bank Negara Indonesia (BNI) and Bank Tabungan Negara (BTN). The method of the research was quantitative research, analysis secondary data. It was conducted from the financial reporting Bank BUMN period from 2011 to 2022. By multiple linear regression analysis, it was found that CAR has a significant negative effect, NPL has a significant negative effect, LDR has a significant positive effect, and NIM has a significant positive effect on profitability. Furthermore, the coefficient of determination shows that the model is able to explain 84.90% of the variation in the four dependent variables.

DO THIRD-PARTY FUNDS AND BANK RISKS AFFECT THE PROFITABILITY OF DIGITAL BANKS ?: INDONESIAN EVIDENCE

This study was conducted on five digital banks in Indonesia, examining the effects of third-party funds (TPF) and bank risks, including credit, market, and operational risks, on profitability. This research employs a quantitative-explanatory approach and uses 96 observational data from five Indonesian digital banks' websites using quarterly financial data from 2019-2023. This study presents novel empirical evidence that the CAR has a positive effect on digital banks' profitability (ROA), and operational risk (OCOI) has a negative effect on profitability (ROA). Using panel data regression, this study finds that TPF and market risks do not significantly affect profitability. The study underscores the crucial role of digital banks' operational and credit risks in profitability while also revealing that TPF and market risk are not among the main drivers of digital banks' profitability.

Acceptance analysis of payment system Quick Response Code Indonesian Standard (QRIS) using technology acceptance model

Digital age has a significant impact on people's daily activities. One of the benefits of digitalization is the emergence of digital payment systems to facilitate transactions. QRIS (Quick Response Indonesian Standard) is one of the non-cash payment systems launched by Bank Indonesia and the Indonesian Payment Systems Association in 2019. Although QRIS continues to increase users every year, the tendency of Indonesian people to use cash or debit cards for transactions is still high. In addition, the discovery of security loopholes in the QRIS payment system also makes people hesitant to use the system. This study aims to examine the effect of perceived ease of use, perceived usefulness, perceived security on actual usage through behavioral intention to use as an intervening variable. The type of research used is explanatory research. Sampling was carried out using non-probability techniques with purposive sampling and accidental sampling methods. The population of this study was QRIS users residing permanently or temporarily in Semarang City. Data processing was carried out using the SmartPLS 3.2.9 software. The results of this study showed that perceived ease of use did not influence actual usage, either directly or indirectly. However, perceived usefulness and perceived security have an indirect effect on actual usage. The influence of behavioral intention to use is full mediation on perceived usefulness and perceived security on actual usage.

Designing an Integrated Performance Management System for a Regional Development Bank in Indonesia

Designing an Integrated Performance Management System for a Regional Development Bank in Indonesia

Board of Commissioners, Chairman of Board of Directors, and Performance Audit Reports on Indonesian Banking Sector: The GMM System Approach

Board of Commissioners, Chairman of Board of Directors, and Performance Audit Reports on Indonesian Banking Sector: The GMM System Approach

Legal Protection Of Fund Saving Customers Against Cyber Phising Acts In Indonesia

Study thesis This analyze about Legal Protection for Customers Saving Funds Against Cyber Phishing in Indonesia. As for focus study This is regarding (1) how cyber phishing phenomenon in scope banking in Indonesia? and (2) how protection law to customers internal fund storage cyber phishing acts in Indonesia? Study This use approach normative ones with choose type study the aim For research governing rules /norms How protection law customers saving funds against cyber phishing acts in Indonesia. Writer study with theory certainty law and theory protection law , which with second knife analysis the writer produce Conclusion (1) The phenomenon of cybercrime with form phishing later This the more massive happened in Indonesia with so rapidly development technology in Indonesia, OJK owns it authority supervise in sector finance until moment This Not yet publish or validate Special OJK regulations arrange matter that's what happened the absence of norms on crime cyber crime with form phishing in Indonesia and (2) Form protection law to customers depositors who become victims of cyber phishing preventive stated in OJK Regulation Number 22 of 2023 changes on OJK Regulation Number 6 of 2022 concerning Protection Consumers and Society in the Financial Sector in Chapter II of the Law as stated in Article 3 paragraphs (1), (2) and paragraph (3) and Article 20. Meanwhile form protection law repressive regulated in Bank Indonesia Regulation Number : 16/1/PBI/2014 concerning Protection System Services Consumers Payment in article 16 paragraphs (1) and (2) later also regulated in law Number 19 of 2016 changes on Constitution Number 11 of 2008 concerning Information and Transactions Electronics in Article 28 paragraph (1) and Article 45 paragraph (1).

ANALYSIS OF THE DIFFERENCES IN THE INFLUENCE OF FINANCING AND INFLATION ON THE PROFITABILITY OF BANK SHARIA INDONESIA (BSI) BEFORE AND AFTER THE MERGER

The purpose of this study was to determine the effect of mudharabah, musyarakah, ijarah, murabahah, istishna’, and inflation financing on the profitability of Bank Syariah Indonesia (BSI) before and after the merger. Profitability in this study is measured by return on asset (ROA). This type of research is quantitative and comparative research because this research will compare the effect of bank financing on the financial performance of BSI before and after the merger. The data in this study are time series data and secondary data sourced from OJK, BSI, and Bank Indonesia websites. The data analysis technique used in this study is time series regression, data processing this study using Microsoft Excel and E-views 12 analysis tools. The results stated that mudharabah financing in the long term had a positive effect on BSI profitability before the merger, musyarakah financing, ijarah, murabahah, istishna’, and inflation had no effect on profitability. Meanwhile, in the period after the merger, long-term mudharabah financing had no effect on BSI profitability, musyarakah financing, and inflation had a positive effect on profitability, murabahah, and istishna’ financing had a negative effect on profitability, ijarah financing had no effect on profitability.

Impact of Macroeconomic Indicators on The Indonesia Stock Exchange (IDX) Composite Index Performance

This study examines the impact of macroeconomic indicators on the performance of the Indonesia Stock Exchange (IDX) Composite Index from 2014 to 2023, focusing on four key variables: interest rates, inflation, money supply (M2), and Gross Domestic Product (GDP). Using a Vector Autoregressive (VAR) model, the research investigates the short-term dynamics between these variables. The findings show that in the VAR estimation, only the lag 1 M2 value has a statistically significant coefficient. However, the Impulse Response Function (IRF) analysis reveals that shocks to the Bank Indonesia rate, inflation, money supply, and GDP initially cause significant fluctuations in the Jakarta Stock Exchange price index, but these effects are short-lived, with the index stabilizing around zero after several periods. These results provide valuable insights for policymakers and investors, emphasizing the importance of understanding macroeconomic conditions for making informed stock market decisions.

Evaluation of the Impact of Monetary Policy on the Financial Performance of Manufacturing Companies: Implications of Interest Rates, Inflation and Macroeconomic Stability

This study aims to evaluate the impact of monetary policy on the financial performance of manufacturing companies in Indonesia, emphasising the implications of interest rates, inflation, and macroeconomic stability. Using a quantitative approach through multiple regression analysis, this study analyzes the relationship between monetary policy variables of Bank Indonesia's benchmark interest rate, inflation rate, exchange rate, foreign exchange reserves, and budget deficit with the company's financial performance, as measured using Return on Assets (ROA), Return on Equity (ROE), and Net Profit Margin (NPM). Secondary data used in this study include the annual financial reports of manufacturing companies listed on the Indonesia Stock Exchange (IDX) from 2015-2023. The study results indicate that the benchmark interest rate has a significant negative effect on ROA and ROE. In contrast, the inflation rate shows varying impacts on NPM and other financial performance. In addition, macroeconomic stability is measured through indicators of the rupiah exchange rate against the USD, foreign exchange reserves, and budget deficit, which significantly affect the company's financial performance. These findings emphasize the importance of monetary policy and macroeconomic stability in determining the profitability of manufacturing companies in Indonesia. This study implies that corporate management needs to develop more adaptive strategies to deal with fluctuations in monetary policy and macroeconomic conditions. In addition, policymakers need to consider the long-term impact of monetary policy on the manufacturing sector to create an economic environment conducive to industrial growth. This study contributes significantly to the literature on the impact of monetary policy on corporate financial performance in emerging markets.

The Influence of Governance Characteristics and Enterprise Risk Management on Intellectual Capital in Banking in Indonesia

Intellectual capital (IC) is a crucial driver of developing knowledge-based economic value for an organization, such as a bank. With intellectual capital, company can generate knowledge-based economic value as a source of competitive advantage, influencing innovation and value for stakeholders. This research aims to analyze and explain the influence of governance characteristics and enterprise risk management on intellectual capital in banking in Indonesia. The independent variables are audit committee, board independence, institutional ownership, enterprise risk management, return on assets, leverage and corporate social responsibility as well as the dependent variable intellectual capital. The data used in this research is secondary data sourced from the annual reports of banking companies listed on the Indonesia Stock Exchange (BEI) during the period 2018 to 2022. The research sample was selected using a purposive sampling method so that 42 companies were sampled. The data analysis used to test the hypothesis is multiple regression analysis using e-views 9. The research results show that the audit committee has a positive effect, board independence has a negative effect, institutional ownership has a negative effect, enterprise risk management has no effect, return on assets has an effect positively, leverage has no effect, and corporate social responsibility has a negative effect on intellectual capital. Implications of this research to understand how bank managers affect intellectual capital, this study examines a variety of factors, including audit committee, board independence, institutional ownership, enterprise risk management, return on assets, leverage and corporate social responsibility. It suggests that managers should focus on enhancing their intellectual capital to make informed investment decisions and effectively manage their bank's resources, thereby enhancing their investment performance.

The Mismatch Between Macroeconomic Stability and Declining Stock Performance of Digital Banks in Indonesia: An Empirical Study of 2022-2023

This study examines the mismatch between macroeconomic stability and the stock performance of digital banks in Indonesia over the period 2022-2023. The results of the analysis show that the USD/IDR exchange rate and Bank Indonesia interest rate have a significant negative effect on stock prices, while inflation shows no significant effect. These findings suggest that despite stable macroeconomic conditions, the share prices of digital banks experienced a significant decline, indicating market inefficiencies. This study makes a theoretical contribution by revealing the role of exchange rate and interest rate fluctuations in influencing the stock performance of digital banks in emerging markets. In conclusion, factors such as investor sentiment, market behavior, and the influence of digital financial technology need to be taken into account in developing strategies to support the stability and growth of the digital banking sector in Indonesia. The results of this study are important for policymakers, regulators, and market participants in dealing with the challenges faced by the digital banking sector in Indonesia. Keywords Digital banking, macroeconomic stability, stock performance, market inefficiency.

Integration of Corporate Governance and Social as a Catalyst for Islamic Banking Financial Performance; Evidence in Indonesia

Corporate governance can be assessed from how the company has been run openly and transparently, to gain public trust in market mechanisms. Islamic banking in Indonesia shows a pattern that social activities are an obligation that must be carried out. Social is a characteristic of Indonesian banking, a financial institution that has implemented the concept of sharia. In this study, the sample used amounted to 132 data on BUS's financial statements for 11 years from 2010-2020. As a result, improved governance, actually led to a decline in financial performance, by the regression value of -0.1682. Meanwhile, the social variable shows that if social performance increases, financial performance also increases by 0.282.

An integrated GRC approach to combating fraud in microloan services

This research aims to reduce fraud risks in Indonesian banks and non-bank financial institutions providing microloan services. The study employs data analytics and machine learning techniques using employee data from Bank X spanning 2017-2019 with samples of 28,004 workers (2017-2018) and 27,274 employees (2019). Confirmatory factor analysis and XGBoost predictive modelling are applied within the fraud triangle framework to identify critical fraud risk indicators related to employee pressure. An algorithmic approach categorizes personnel based on fraud risk ratings enabling the detection of potentially suspicious activities for proactive intervention. The analysis reveals that incorporating data analytics into governance, risk management and compliance (GRC) systems can accurately forecast fraud probability by focusing on factors associated with employee pressure and opportunities. This facilitates targeted fraud prevention solutions by integrating control mechanisms, risk processes and auditing standards. The predictive model provides valuable insights for policymakers to combat fraud by enhancing governance and risk management practices specific to microloans. This research concludes that the predictive model is a pragmatic decision-making tool for banks offering micro-loans. It mitigates dangers by detecting high-risk personnel and transactions. Integrating data analytics with robust GRC frameworks enables financial institutions to uphold integrity through proactive fraud monitoring and targeted preventive interventions tailored to identify risk profiles. The study offers an integrated technological organizational approach to protect microlending activities.

Konvergensi Bank dan Ketahanan Bank terhadap Pandemi

Book bank 4 is the bank with the largest number of assets and controls more than half of the banking market in Indonesia. Since the early 2000s BUKU 4 bank is an exclusive club consisting of the 4 largest banks in Indonesia. This changed in 2017 when CIMB Niaga bank entered BUKU 4 bank and a year later Panin bank joined. This study examines what factors underlie these banks can merge into a BUKU 4 bank. Further this research then examines the resilience of BUKU 4 banks to the pandemic. The research method is a quantitative method using multiple linear regression. The research uses data taken from the financial statements of 2010 to 2018. The results show that the factors that drive the convergence of banks are the factors of capital adequacy, low borrowing loans and operational efficiency of banking. Meanwhile, in order for banks to survive this research finds investment factors in technology, maintaining capital adequacy and unpaid debt management.

Penyesuaian Penyangga Modal dan Risiko Bank-Bank di Indonesia Sebagai Respon Terhadap Potensi Krisis Keuangan di Tengah Kondisi Ketidakpastian Global

This study aims to analyze the impact of capital buffer adjustment and risk adjustment on systemic risk, using a sample of 18 banks in Indonesia, from 2006 to 2020. The results of this study indicate that risk adjustment has a positive effect on systemic risk, and capital buffer adjustment has a negative effect on systemic risk. The results of this study also show that risk adjustments and capital buffer adjustments, in response to a potential financial crisis in the midst of global uncertainty, have different impacts on systemic risk depending on global conditions.

The Effect of Capital Adequacy, Financing Risk, and Islamic Corporate Governance on Financial Performance with Islamic Social Reporting as an Intervening Variable

The purpose of this research is to examine and analyze the effect of capital adequacy, financing risk, and Islamic Corporate Governance on financial performance through disclosure of Islamic Social Reporting. The population of this research consists of fifteen Sharia Commercial Banks (IB) in Indonesia which are registered with the Financial Services Authority. The sample consists of ten IBs. This research used quantitative approach with panel data regression method and Sobel test on Eviews-13. The results show that capital adequacy has a positive effect on financial performance. Financing risk, Islamic Corporate Governance, and Islamic Social Reporting have no effect on financial performance. Islamic Social Reporting cannot mediate the capital adequacy, financing risk, and Islamic Corporate Governance on financial performance.

Strategy to Increase Market Share Current Account Saving Account (CASA) Through Optimizing the Development of Electronic Banking in Indonesia

The basis of this research is motivated by the phenomenon that occurs where banking services in Indonesia have still known for a very long time and require a struggle to make a transaction. A network that is often problematic, strict regulations and the length of the account creation process are some examples of problems related to banking services in Indonesia. This study aims to find out how the development of electronic banking at Bank BJB, the Market Share Current Account Savings Account at Bank BJB, what obstacles are faced in the development of electronic banking at Bank BJB, and what strategies are carried out to increase CASA market share through the optimization of electronic banking development. The research method used is qualitative by interviewing resource persons from within the company, policymakers, and practitioners in the banking sector. The results obtained show that Bank BJB has carried out digital service transformation specifically in 2021. The company has made several developments in terms of core banking, switching, and networking. CASA's market share has not reached the expected target. Several strategies to increase Bank BJB's CASA market share through electronic banking optimization include the development of a user-friendly Mobile application. Focus on developing an intuitive and easy-to-use mobile app.

The influence of organizational culture and non-financial compensation on organizational commitment with job satisfaction as a mediation variable

Companies must be able to optimize human resources performance because they are an essential element in the organization and play an active role as planners, actors, and determinants for realizing organizational goals. This research aims to see the influence of organizational culture and non-financial compensation on organizational commitment, either directly or indirectly or through the mediation of job satisfaction. This research is categorized as explanatory research. The research respondents were permanent employees at the regional office of one of the largest banks in Indonesia. The sample size was determined using a total sampling of 150 respondents. The data collection method uses a questionnaire and is analyzed using PLS-SEM. The results show that organizational culture has a significant positive effect on organizational commitment, and non-financial compensation also has a positive and significant effect on organizational commitment. Organizational culture and non-financial compensation positively affect organizational commitment through the mediation of job satisfaction.