Indonesia's Great Potential to Dominate the Global Sharia Economy and Finance

Strong support from the Government and stakeholders has made the Sharia economy and finance an important pillar of national development. With promising asset growth and an expanding market share, Indonesia has the potential to dominate the global Sharia economy and finance.

Zikrina Ratri
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2 Minutes
By: Zikrina Ratri
Indonesia's Great Potential to Dominate the Global Sharia Economy and Finance

Up to this year, sharia financial assets have been growing rapidly, and are even projected to exceed Rp 9,529 trillion by early 2025. This sector has become a priority in the National Long-Term Development Plan (RPJPN) 2025-2045. With a focus on strengthening the role of sharia finance, optimizing sharia social funds for poverty alleviation, and strengthening halal industries and UMKM, it is key to realizing Indonesia's ambition to dominate the global sharia economy and finance.

The growth of Islamic financial assets in Indonesia shows a consistent positive trend from year to year. Based on data published by the Financial Services Authority (OJK), Indonesia's total sharia financial assets (including Sharia Banking, Sharia IKNB, and Sharia Capital Market) will reach IDR 2,884 trillion by 2024. 

When compared to the previous five years (2019), the total assets have increased significantly by 28.3% (from IDR 1,468.07 trillion). The highest increase occurred in 2020 with a growth of 22.70%(year-on-year). This indicates the growing public trust and interest in sharia services and products in the country.

In Islamic finance, the Islamic Capital Market sector plays a dominant role in total national Islamic financial assets, with a market share percentage that reaches more than 50%, which in 2024 is recorded at IDR 1.7 thousand trillion. This reflects the large capitalization value of Islamic stocks and outstanding sukuk (Islamic securities). 

In addition, positive developments can also be seen in the increase in the overallmarket share of Islamic finance compared to conventional finance. OJK data shows that the market share of Islamic finance continues to grow every year, reaching 11.45% in 2024. A steady jump from 9.95% in 2020. This increase in share indicates widespread adoption and acceptance at the national level.

Recognition of Indonesia's efforts and achievements in developing this sector has also come from the global arena. Indonesia is ranked 4th globally in the Islamic Finance Development Indicator (IFDI) 2024 and 6th overall in global Islamic finance.

This achievement is supported by excellence in several key IFDI 2024 indicators, where Indonesia ranks 1st in the Education and Research category related to Islamic finance. In addition, Indonesia also ranked 2nd for Regulation and Events, and 3rd for Sukuk and ESG(Environmental, Social, and Governance) sharia.

This achievement lays the foundation for Indonesia's ambition to lead the global Islamic economy and finance. With an impressive IFDI 2024 ranking and consistent asset growth, the government continues to build a supportive ecosystem. 

These efforts include strengthening regulations, developing human resources through education and research, and focusing on Islamic social finance instruments such as waqf and zakat. The commitment contained in the 2025-2045 RPJPN and the strong push from the Coordinating Ministry for Economic Affairs to improve Indonesia's ranking to number one in the world, shows that the growth potential of this sector is still very large and will be the driving force of the national economy in the future.

Data News Finance

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Zikrina Ratri
Zikrina Ratri

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