fbpx 48466-001: Enhancing the Regulatory Framework of Financial Sector Development and Oversight | Asian Development Bank

Indonesia: Enhancing the Regulatory Framework of Financial Sector Development and Oversight

Sovereign (Public) Project | 48466-001 Status: Closed

The proposed technical assistance (TA) aims to support the Government of Indonesia in enhancing the regulatory framework of financial sector development and its oversight at the newly established Financial Sector Agency or Otoritas Jasa Keuangan (OJK) and at the Ministry of Finance (MOF). The oversight of financial sector in Indonesia entered a new phase with establishment of OJK, which is now responsible for regulating banking sector, capital market, and non-bank financial institutions. The establishment of OJK also gives Ministry of Finance (MOF) a new responsibility as the institution which is responsible for policy making for the financial sector lies.

Project Details

Project Officer
Mohd Sani Mohd Ismail Southeast Asia Department Request for information
Country
  • Indonesia
Modality
  • Technical Assistance
Sector
  • Finance
 
Project Name Enhancing the Regulatory Framework of Financial Sector Development and Oversight
Project Number 48466-001
Country Indonesia
Project Status Closed
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 9054-INO: Enhancing the Regulatory Framework of Financial Sector Development and Oversight
Technical Assistance Special Fund US$ 1.50 million
Strategic Agendas Inclusive economic growth
Regional integration
Drivers of Change Governance and capacity development
Knowledge solutions
Private sector development
Sector / Subsector

Finance / Money and capital markets

Gender Equity and Mainstreaming No gender elements
Description The proposed technical assistance (TA) aims to support the Government of Indonesia in enhancing the regulatory framework of financial sector development and its oversight at the newly established Financial Sector Agency or Otoritas Jasa Keuangan (OJK) and at the Ministry of Finance (MOF). The oversight of financial sector in Indonesia entered a new phase with establishment of OJK, which is now responsible for regulating banking sector, capital market, and non-bank financial institutions. The establishment of OJK also gives Ministry of Finance (MOF) a new responsibility as the institution which is responsible for policy making for the financial sector lies.
Project Rationale and Linkage to Country/Regional Strategy The TA is a continuation of ongoing Asian Development Bank (ADB) support to enhance the capacity of financial sector regulators and also to assist ADB's and the Government in implementing reform agenda stated in the Financial Market Development and Inclusion Program (FMDIP).
Impact Impact of the TA is aligned with the National Medium Term Development Plan, 2015- 2019 for improved resiliency and stability of Indonesia's financial system, and expanded access to financial services for all.
Project Outcome
Description of Outcome A regulatory system for integrated supervision, adoption of international standards, and a more inclusive financial sector created.
Progress Toward Outcome The TA has engaged consultants and resource persons in the fields of finance (including financial inclusion and Islamic finance), law and information technology. It has funded workshops to support FPA (Repo workshop); OJK (Corporate Sukuk) and has co-financed with OJK the international seminar entitled _Navigating Towards Financial Stability in an Evolving Global Economic System_ that was held in Bali in July 2017. The TA has also engaged and extended the contracts of three individual consultants that formed an editorial team to work closely with OJK in the preparation of the publication entitled: _FinTech: A New Instrument for Enhancing Financial Inclusion through Developing Microfinance Infrastructure_, targeting publication by third quarter 2018. The TA also supported OJK in organizing two workshops (in Medan and in Surabaya) for the preparation of the survey of the Programme for International Student Assessment (PISA). This survey helped OJK gather information on which aspect of financial literacy of students needs to be improved, hence, assist OJK in formulating the best strategy to deliver the knowledge.
Implementation Progress
Description of Project Outputs

1. Government's policy making and coordination of FKSSK improved

2. OJK''s integrated supervisory and ICT framework developed.

3. International standards for conventional and Islamic finance implemented.

4. Financial inclusion regulatory framework strengthened with focus on microfinance, branchless banking, consumer protection, and financial literacy surveys .

Status of Implementation Progress (Outputs, Activities, and Issues)

To date, TA has engaged (i) an international financial sector monitoring and evaluation expert to support the implementation of the financial sector Master plan and (ii) three national information technology experts in eXtensible Business Reporting (XBRL) Language to assist OJK in the Information and Communication Technology Solution (ICTS) component of the TA; (iii) Financial stability expert; (iv) Fintech editorial team; (v) Islamic finance expert and a(vi) Multimedia content developer for financial inclusion responsible for developing online training modules for financial education of elementary, junior and senior high school students across Indonesia. These modules, which were completed in March 2018, were based on existing financial literacy publications of the students in the above education levels. The TA has also engaged resource persons in the fields of finance (including financial inclusion), law and information technology for workshops and meetings organized by OJK. The TA has also co-financed with OJK the international seminar entitled _Navigating Towards Financial Stability in an Evolving Global Economic System_ that was held in Bali in July 2017 and PISA workshops in Nov 2017. The team of three individual consultants formed an editorial team who worked closely with OJK in the preparation of the publication entitled: _FinTech A New Instrument for Enhancing Financial Inclusion through Developing Microfinance Infrastructure_.

The TA was Physically completed on 31 January 2019.

Geographical Location Nation-wide
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design ADB coordinates with development partners including the International Monetary Fund and the World Bank. Coordination for FMDIP is based on the government's process through the Center for Financial Sector Policies. ADB provides TA support to the Center together with the Australia Indonesia Partnership for Economic Governance, the World Bank, and the International Monetary Fund.
During Project Implementation
Business Opportunities
Consulting Services The proposed TA will provide national and international consultants and resource persons that will help OJK to (i) develop their integrated supervisory and ICT framework, (ii) implement international standards in conventional and Islamic finance, and (iii) broaden financial inclusion through micro finance, branchless banking and improvements in the methodology for financial literacy surveys. The consultants will be engaged by ADB in accordance with its Guidelines on the Use of Consultants (2013, as amended from time to time).
Responsible ADB Officer Mohd Sani Mohd Ismail
Responsible ADB Department Southeast Asia Department
Responsible ADB Division Public Management, Financial Sector and Trade Division, SERD
Executing Agencies
Fiscal Policy Office-Ministry of Finance
Fiscal Policy Office-Ministry of Finance
Gedung RM Notohamiprojo, 8th floor
Jl. DR. Wahidin No. 1
Jakarta, Indonesia
Timetable
Concept Clearance 17 Sep 2015
Fact Finding 23 Mar 2015 to 02 Apr 2015
MRM -
Approval 16 Dec 2015
Last Review Mission -
Last PDS Update 28 Mar 2019

TA 9054-INO

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
16 Dec 2015 17 Feb 2016 17 Feb 2016 31 Jan 2018 31 Jan 2019 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
1,500,000.00 0.00 75,000.00 0.00 0.00 0.00 1,575,000.00 16 Dec 2015 1,222,806.29

Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.

The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.

The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.

In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

Safeguard Documents See also: Safeguards

Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

None currently available.

Evaluation Documents See also: Independent Evaluation

None currently available.

Related Publications

None currently available.


The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.

Requests for information may also be directed to the InfoUnit.

Tenders

No tenders for this project were found.

Contracts Awarded

Contract Title Approval Number Contract Date Contractor Contractor Address Executing Agency Contract Description Total Contract Amount (US$) Contract Amount Financed by ADB (US$)
Policy and Advisory Technical Assistance 9054 24 Jul 2017 Intuition Publishing Ltd.(Irish Republic) IFSC House, Custom House Quay Dublin 1 Dublin, Ireland Fiscal Policy Office 183,646.00

Procurement Plan

None currently available.