Starting with a close look at OJK, what is shadow banking?

Reporter: Laurensius Marshall Sautlan Sitanggang | Editor: Herlina Kartika Dewi

KONTAN.CO.ID – JAKARTA. The rise of cases of burglary of customer funds, such as that which occurred by a private bank in the country, has caused many allegations to emerge. One of them concerns the alleged shadow banking practice. This has also been conveyed by the Financial Services Authority (OJK), which sniffed out the existence of bank products being sold by non-bank institutions.

“There are bank products that are provided from non-banks, this cannot be taken lightly. This is shadow banking,” said Chairman of the OJK Board of Commissioners Wimboh Santoso at a Joint Working Meeting with Commission XI DPR, last Thursday (12/11).

According to Wimboh, this type of transaction must be continuously monitored. This is because many people today are more active in conducting transactions with non-bank financial institutions rather than playing a role.

“Because the bank is closely monitored. This is if it’s still small, okay. But if it gets bigger it becomes an issue. We support it if this becomes a discussion on a road map regarding digital,” he said.

Also Read: Reflecting on the Winda Lunardi case, what are the benefits of a checking account?

In his statement, shadow banking, according to OJK, is like a kind of virtual bank. He admitted that several parties had also started discussing the existence of virtual banking.

In fact, before the OJK discussed the alleged shadow banking practice, PT Maybank Indonesia Tbk Hotman Paris’s attorney made this point.

In an article published by Kontan.co.id, Monday (9/11), Hotman suspected that there was a shadow banking practice that was actually carried out by the AT suspect from Maybank customer funds on behalf of Winda Lunardi. Because from the police investigation, he said, Winda’s account funds were also channeled to six other people who were colleagues of the suspect AT to be invested.

“This is the reason why Maybank is waiting for the legal process. “We must first investigate who was involved, if it is true that a simple burglary, Maybank will definitely replace it immediately, but if there is another party, it cannot just be paid,” he said.

Regarding this shadow banking, Kontan.co.id has asked for an explanation from the OJK. However, until this news is up the regulator has not been able to comment.

But, what is shadow banking actually? In several articles published by Kontan.co.id, shadow banking or commonly referred to as underground banking is a financial activity that occurs outside the regulations of the banking system.

Such as offering investment or funding products that do not use the banking system. For example, a bank official offered several investment products that were not related to the bank or institution where he worked and did not implement a mechanism according to the applicable banking regulations.

It is suspected that the attorney for Maybank Indonesia occurred in the case of the loss of customer funds amounting to Rp 22 billion.