Not About Getting Rich: The Real Reason Indonesians Are Saving More
The habit of Indonesians saving money in banks has continued to increase this year. This phenomenon is particularly visible among customers with savings balances below Rp100 million, which recorded the highest growth compared to other deposit groups.
At first glance, this condition could be interpreted as a signal of improving household financial health. Larger funds stored in banks are considered a cushion for the public to maintain consumption when facing economic pressures.
However, the latest study by BCA in The Focal Point report, published on 22 June 2026 and titled ‘Many Shades of Precautionary Savers’, tells a different story. The increase in savings reflects a public attitude of choosing to be cautious in the face of economic uncertainty rather than enjoying a rise in income.
‘Precautionary behaviour amid continued rupiah pressure explains why rupiah savings are lagging behind foreign currency savings, especially among more affluent savers,’ BCA wrote in its report.
Two major concerns are looming over the public. Groups with larger funds tend to be wary of the rupiah’s depreciation, while lower-income groups are more worried about the rising prices of daily necessities.
Savings growth was strongest in the group with balances below Rp100 million. As of April 2026, savings in this group grew by 5.4% year-on-year. This figure is higher than the 3.1% growth for the Rp100 million to Rp500 million balance group and the 2.4% growth for the Rp500 million to Rp1 billion group. On a year-to-date basis, lower-income group savings also rose by 0.98%.
However, this reading requires caution. At the same time, rupiah savings among wealthier groups actually declined. For the top tier, the decline in rupiah savings reached 2.47%.
Data from the Indonesia Deposit Insurance Corporation (LPS) shows that overall banking deposits remain large. In April 2026, nominal deposits reached Rp10,107 trillion, up about 11.4% from Rp9,076 trillion in April 2025. However, on a monthly basis, deposits fell by 1.40% from March 2026. This decline reflects a change in asset preferences. More affluent groups have greater room to shift funds to other instruments, including foreign currency deposits, especially when the rupiah remains under pressure.
Bank Indonesia data in the Money Supply report published on Tuesday (23/6/2026) reinforces this picture. In May 2026, rupiah savings grew 8.7% year-on-year to Rp2,904.2 trillion. However, foreign currency savings grew much faster, surging 29.9% year-on-year to Rp260.9 trillion. This signals that public interest in holding foreign currency deposits is increasing, particularly amid concerns over the rupiah’s weakening. Total third-party funds in foreign currency also grew 17.8% year-on-year to Rp1,585.1 trillion in May 2026, far outpacing the 9.6% growth in rupiah deposits to Rp8,113.7 trillion. Bank Indonesia’s move to tighten the limit on foreign currency purchases to a maximum of US$10,000 also indicates that the shift in interest from rupiah to foreign currency is becoming an increasingly important issue.
The increase in lower-income group savings is also difficult to read as a sign that public income is rising strongly. Manufacturing activity remains unstable. In May 2026, the Manufacturing PMI was at 49.7, re-entering the contraction zone. This is significant because manufacturing is closely linked to employment and public income. If factory activity weakens, the room for income improvement is also limited. Household income expectations for the next six months are also not very convincing, with the index at 136.5 in May 2026, down from previously higher levels. Therefore, the increase in lower-income group savings is more likely due to changes in how the public manages money, rather than a sharp improvement in income.
Changes in investment choices also explain why bank savings are rising again. Household interest in gold and jewellery is starting to decline. In May 2026, the proportion of households choosing savings or deposits as an investment instrument reached 42.7%, higher than the 36.3% who chose gold or jewellery. This is a reversal from January 2026, when gold was more dominant. Some of the public are starting to return to banking products perceived as safer and more stable. Rising interest rates have also made deposits more attractive, while the pace of gold price increases has begun to lose momentum.
The strongest factor is the fear of rising prices. Many households are increasing their savings because they want to have reserve funds in case goods become more expensive. This pattern is visible in the portion of household expenditure allocated for consumption. In May 2026, the consumption portion was 72.3%, up from a low of 71.6% at the beginning of 2026, but still lower than the previous position of around 74.3%.