OJK Urges Banks to Strengthen Financing to Combat Climate Change

The Financial Services Authority (OJK) is encouraging the banking sector to strengthen sustainable financing to face the risks of climate change. This has become one of the priorities in the Roadmap for the Development and Strengthening of Indonesian Banking (RP3I) 2026-2030, which was discussed in Kuta, Badung, on Friday (2/10/2026).

OJK Executive Head of Banking Supervision, Dian Ediana Rae, stated that various natural disasters occurring in Sumatra, East Nusa Tenggara (NTT), as well as in several countries such as Nepal and Thailand, demonstrate that climate change issues require serious attention.

“This shows that our natural issues, these climate issues, have become extremely dangerous. From my perspective, this represents a critical point,” she said on Friday (2/11/2026).

Dian noted that to address these issues, OJK is promoting sustainable finance. According to her, the banking sector plays a vital role in driving such financing.

“Therefore, we need to continue promoting sustainable finance, not merely as a means of complying with regulations, but as an integral part of business strategy and risk management,” she said.

Dian explained that the financial sector, particularly banking, is the largest source of financing in Indonesia, accounting for approximately 80%. Consequently, the higher the level of sustainable financing distributed by banks, the greater the support for environmental mitigation efforts.

“If banks can develop high awareness regarding sustainable finance, such as new and renewable energy, it will certainly assist in improving the environmental conditions we currently face,” she explained.

Furthermore, Dian added that bank financing is also necessary to support the transition costs from fossil-based energy to more sustainable energy sources.

“For example, how we must switch from relying on coal to other forms of energy, such as renewable energy, and so on,” she added.