58 Pension Funds Closed in Six Years, Here's the Culprit

Jakarta, CNBC Indonesia — The Financial Services Authority (OJK) has recorded that 58 pension funds have been dissolved since 2020 up to the present. The majority of these were Employer-Sponsored Pension Funds (DPPK) offering defined benefit pension programmes.

Ogi Prastomiyono, Chief Executive of Insurance, Guarantee and Pension Fund Supervision at OJK, said the dissolution of these pension funds was influenced by several factors, including efficiency considerations, a decline in participant numbers, and economies of scale considered no longer adequate.

“This condition is in line with the global tendency of a shift from defined benefit schemes to defined contribution schemes,” Ogi said at the OJK Monthly Press Conference for August 2026 on Monday (7/9/2026).

Going forward, according to Ogi, the task at hand is to deepen the industry by expanding membership among informal workers, micro, small and medium enterprises (MSMEs), the younger generation, and other segments of society, including through digitalisation.

He said expanding membership is one of the focuses OJK has been pushing for, including through the 2024 Pension Fund Month. These efforts are expected to broaden public access to pension programmes whilst strengthening the pension fund industry in Indonesia.

Deepening the pension fund industry also has the potential to be supported by policy developments in the employment sector. The draft law on employment protection is currently in its finalisation stage and is directed at expanding the coverage of worker protections through severance guarantees within the pension programme ecosystem.

Meanwhile, regarding the Constitutional Court’s ruling on the payment of pension benefits formed from severance pay, long service awards, and/or rights compensation for participants, OJK has issued Decision Number 54/D.05/2024. The decision was issued as a follow-up to the Constitutional Court ruling on pension benefit payments.

OJK is also currently making adjustments to OJK Regulation (POJK) Number 27 of 2023 to accommodate these provisions. In principle, the pension benefit payments in question may be made either as a lump sum or periodically, according to the participant’s choice.

For information, total pension fund assets as of July 2026 grew 6.70% year on year (yoy) to reach Rp 1,699.99 trillion. For voluntary pension programmes, total assets recorded growth of 4.24% yoy to reach Rp 409.19 trillion.

For mandatory pension programmes, comprising the old-age guarantee and pension guarantee programmes of BPJS Ketenagakerjaan as well as old-age savings and pension contribution accumulation programmes for civil servants, the Indonesian National Armed Forces and the Indonesian National Police, total assets reached Rp 1,290.80 trillion, or a growth of 7.51% yoy.