JAKARTA – Credit channelling expansion will increase the portion of fundings of non-Third-Party Funds (lit. Dana Pihak Ketiga/DPK).

As quoted from the Outlook of Financial Market Development of December 2023, Indonesia Deposit Insurance Corporation or IDIC (lit. Lembaga Penjamin Simpanan) said that the access to non-third-party funding will be more likely to be used by upper and middle-class banks in order to attain more affordable long-term funding target. The sources of this non-third-party funding include obligations owed by other banks, issued securities, and loans.

In October 2023, non-third-party funding source grew 0.20% year-on-year (yoy) and 6.01% from September 2023 (month-to-month/mtm). The primary contributor of this non-third-party funding source is obligations of other banks worth IDR 41.06 trillion. This increase in fund source indicates that banks will optimise mid-term and long-term funding sources amidst the surge of loan interests.

Banks are projected to diversify its non-third-party funding sources, putting things in consideration, such as the liquidity needs and market condition, in order to boost credit growth. (LK/ZH)