Bank Indonesia: Average Public Savings In Banks Drops To The Lowest Level Of The Year

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Bank Indonesia: Average Public Savings In Banks Drops To The Lowest Level Of The Year

Tuesday, 10 Dec 2024

The average savings of the public in banks experienced a decline in October 2024, reaching the lowest level recorded this year. According to data from the Indonesian Financial System Statistics (SSKI) of Bank Indonesia (BI), the average savings of Indonesian household customers stood at IDR 4.19 million in October 2024. This figure is derived from a total household savings amounting to IDR 2,450.25 trillion, with the number of accounts reaching 585 million.

This decrease aligns with the average third-party funds (DPK) of Indonesian household customers, which fell to IDR 6.58 million, marking the lowest point for 2024. "This represents the lowest condition at least for this year," stated Yusuf Rendy Manilet, an economist at the Center of Reform on Economics (Core), on Monday, December 9, 2024.

Yusuf noted that the decline in bank savings reflects the ongoing phenomenon of "consuming savings" as the year comes to a close. The public continues to rely on their savings to meet daily needs.

"The decrease in DPK is a strong indication of the phenomenon where people are using their savings for everyday expenses," he explained. "As a result, their ability to allocate funds that they would typically save has diminished," he added.

Furthermore, Yusuf indicated that the persistence of the savings consumption phenomenon is closely linked to the low growth of real wages among workers. He pointed out that the growth of real wages, particularly in five key sectors that employ approximately 75 percent of the workforce, has declined, especially in 2024 compared to the pre-pandemic conditions of 2019.

On the other hand, the expenses incurred by the public have once again risen, as indicated by the consumer price index (CPI) experiencing inflation. In October 2024, an annual inflation rate of 1.71 percent was recorded, along with a monthly inflation rate of 0.08 percent.

"It is indeed noticeable that inflation has occurred in October, which we all know follows several months of deflation in the economy," stated Yusuf. The decline in average savings and third-party funds (DPK) is considered a matter of concern for the government. This decrease is expected to impact purchasing power and household consumption, which remains a crucial pillar of the national economy. (putri@insightinnews.com)

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