President Prabowo Inaugurates Gold Bank, What is its Impact on Indonesia's Economy?

Kapanlagi.com - On February 26, 2025, Indonesia recorded a new history with the launch of the Gold Bank, a revolutionary innovation initiated by President Prabowo Subianto, in collaboration with Pegadaian and Bank Syariah Indonesia (BSI). As the country with the sixth largest gold reserves in the world, Indonesia finally has a financial institution that specifically manages this valuable asset, which has not been optimally utilized before.

The Gold Bank is expected to be a driving force for the national economy, with projections of an increase in Gross Domestic Product (GDP) reaching Rp245 trillion. The existence of this bank is expected to maximize the potential for monetizing domestic gold, which has been neglected until now. Moreover, the Gold Bank is also predicted to create around 1.8 million new jobs, providing a breath of fresh air in labor absorption and reducing unemployment rates in the country.

More than just a financial institution, the Gold Bank is expected to be a pillar of national economic resilience. By holding domestically mined gold, Indonesia aims to reduce dependence on foreign markets and strengthen foreign exchange reserves. Gold also serves as a hedge against inflation and global currency instability, making it an increasingly vital commodity amid the challenges of the world economy.

1. What is a Gold Bank and How Does It Work?

A Gold Bank, or what is known as a bullion bank, is a financial innovation that allows people to invest in gold without the hassle of owning the physical metal. With this system, you can buy digital gold, save it as savings, and withdraw it in physical form whenever you wish.

This concept has been implemented in several countries, such as Malaysia and Turkey, where banks like Maybank, Public Bank, Kuveyt Türk, and Türkiye Bankası offer sharia-compliant digital gold services with affordable storage fees.

In Indonesia, the presence of Gold Banks is expected to enhance financial inclusion, especially for those who wish to invest but are hindered by storage costs and access to physical gold.

2. Positive Impact of Gold Banks on the Indonesian Economy

Gold Banks have several highly anticipated positive impacts, including:

• Increased Liquidity in Financial Markets: Significant monetization of gold can enhance liquidity in Indonesia's financial markets, opening opportunities for the development of new gold-based financial instruments, such as gold derivatives.
• Diversification of State Revenue Sources: Effective management of gold can generate additional revenue for the state through international trade or gold investments.
• Stability of Domestic Gold Prices: The presence of Gold Banks is expected to stabilize gold prices in the domestic market, reducing the influence of global price fluctuations and speculation.
• Development of Gold-Based Financial Products: Gold Banks enable the development of a wider variety of gold-based financial products, such as gold savings and gold-backed loans.

Additionally, the efficiency of gold transactions will improve as transactions can be conducted domestically, without relying on international intermediaries. This will increase trading volume and efficiency.

3. Considerations for the Success of the Gold Bank

Although its potential positive impact is significant, the success of the Gold Bank also depends on several important factors:

• Transparent and Accountable Management: It is crucial to ensure that gold management is conducted with strict, transparent, and accountable standards to prevent potential corruption.
• Clear and Comprehensive Regulations: Clear regulations are necessary to govern the operations of the Gold Bank and ensure compliance with international standards.
• Sufficient Infrastructure Development: Adequate infrastructure, including secure storage systems and advanced technology, is essential to support the operations of the Gold Bank.
• Active Participation from All Parties: The success of the Gold Bank requires active participation from the government, financial institutions, and the community.

4. The Impact of the Gold Bank on the Indonesian Economy

The establishment of the Gold Bank not only benefits the community but also has a significant impact on the national economy.

1. Increasing Foreign Exchange Reserves

With the increase in gold investment domestically, the Gold Bank has the potential to enhance the national gold reserves, which can ultimately strengthen Indonesia's economic stability.

2. Reducing Illegal Gold Circulation

Illegal gold remains a problem in Indonesia, especially regarding smuggling and trading gold without permission. With the presence of the Gold Bank, gold transactions can be conducted in a more controlled and supervised manner, thereby reducing illegal practices.

3. Promoting Financial Digitalization

The Gold Bank supports digital transformation in the financial sector, allowing the community to invest in gold through digital platforms with a more efficient and transparent process.

5. FAQ

What is a Gold Bank?

A Gold Bank is a financial institution that manages gold transactions and related investments, providing better access for the public to invest in gold.

Who manages the Gold Bank?

The Gold Bank is managed by PT Pegadaian and Bank Syariah Indonesia (BSI).

When did the Gold Bank start operating?

The Gold Bank officially began operations on February 26, 2025.

How can the Gold Bank help the Indonesian economy?

The Gold Bank can increase GDP, create jobs, and reduce dependence on foreign markets.

(kpl/rmt)