The International Journal of Financial Systems
Financial systems form the backbone of modern economies, comprising a complex network of institutions, markets, regulations, and instruments that facilitate the efficient allocation of resources, risk management, and economic growth. Given the increasingly interconnected nature of our global economy, studying financial systems has become imperative for individuals, organisations, and policymakers alike. The development of financial systems is an ongoing process influenced by a myriad of factors, including technological advancements, regulatory frameworks, and changing market dynamics. Over time, financial systems have evolved from traditional, localised models to globalised, technology-driven ecosystems. Innovations such as digital banking, mobile payments, blockchain technology, and algorithmic trading have revolutionised financial transactions, reshaping the landscape of financial systems. Research on financial systems holds immense importance, as it delves into the intricacies and complexities associated with these systems. By examining various facets such as financial institutions, markets, instruments, regulatory frameworks, and risk management practices, researchers contribute to our understanding of how financial systems function, their efficiency, and their stability. Policymakers rely on this research to formulate effective regulations and policies that promote stability, enhance resilience, and mitigate systemic risks within financial systems. Furthermore, practitioners in the field of finance, including bankers, financial analysts, investment managers, and policymakers, benefit greatly from research on financial systems. These insights enable them to make informed decisions, manage risks effectively, and develop strategies that foster financial intermediation, sustainable economic growth, and financial inclusion. SCOPE The International Journal of Financial Systems welcomes papers from researchers, academics, and practitioners worldwide. We specifically invite contributions that address the following key topics: Financial Institutions Financial Instruments Financial Markets Financial Regulations and Policies Financial Inclusion Financial Literacy and Education Islamic Finance Sustainable Finance Innovative Financial Technology Financial System Stability Financial Integration
Articles
32 Documents
<![CDATA[Revisiting the Influence of Lending Rate to Indonesia’s Credit Market ]]>
<![CDATA[Luviyanto, Afif Narawangsa]]>;
<![CDATA[Prabowosunu, Mohammad Alvin]]>;
<![CDATA[Pavayosa, Erin Glory]]>
<![CDATA[ The International Journal of Financial Systems Vol. 3 No. 2 (2025) ]]>
Publisher : <![CDATA[Otoritas Jasa Keuangan ]]>
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DOI: 10.61459/ijfs.v3i2.91
<![CDATA[This paper investigates the responsiveness of credit volumes to changes in lending rates in Indonesia and reexamines the strength of the monetary transmission mechanism through the credit channel. Using a vector autoregression framework applied to disaggregated bank credit data by sector, loan type, and firm size, we analyse how policy-driven interest rate movements propagate into actual lending outcomes. The results reveal a markedly uneven transmission: credit to micro, small, and medium enterprises (MSMEs) shows negligible sensitivity to interest rate changes, whereas lending to large firms responds more appreciably. In particular, bank credit to large corporates declines significantly when policy rates rise, consistent with conventional theory, while credit to smaller firms remains largely unaltered. These findings suggest that the traditional interest rate pass-through is fragmented and weak in key segments of the economy, undermining the efficacy of pricebased monetary policy. The analysis points to structural factors, including heterogeneous bank behaviour, borrower constraints, and a propensity of banks to shift toward safer assets in uncertain times as underlying causes. The findings imply the need for a more nuanced policy approach that complements interest rate adjustments with targeted interventions to achieve broad-based credit stimulus and effective monetary control. ]]>
<![CDATA[Optimizing Strategic Economic Pillars for National Resilience: A Study on the Impact of Trump’s 19% Tariff on Indonesia’s Economic Stability ]]>
<![CDATA[Zahra, Khalista Arintyas]]>;
<![CDATA[Kautsar, Farah Amilya]]>;
<![CDATA[Ilma, Ajeng Faizah Nijma]]>
<![CDATA[ The International Journal of Financial Systems Vol. 3 No. 2 (2025) ]]>
Publisher : <![CDATA[Otoritas Jasa Keuangan ]]>
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DOI: 10.61459/ijfs.v3i2.94
<![CDATA[As a global superpower, the United States plays a dominant role in international political and economic dynamics. The election of Donald Trump in 2017, under the “Make America Great Again” agenda, marked a shift toward protectionist trade policies, including higher import tariffs, in response to China’s rapid economic rise, triggering the U.S.–China trade war. Although U.S. import tariffs were subsequently reduced from 32% to 19%, they continued to pose risks to economic stability in developing countries, including Indonesia. This study employs a mixed-methods approach combining qualitative analysis and quantitative tools—SWOT, Internal–External Factor Evaluation (IFE–EFE), and the Analytic Hierarchy Process (AHP) to examine the impact of the trade war on Indonesia’s economic stability and to formulate a prioritized strategic policy mix. The results indicate that strengthening national economic resilience requires a balanced inward- and outward-looking strategy, including export-oriented industrial downstreaming supported by TKBI policies, export market diversification through RCEP and IEU–CEPA partnerships, enhanced utilization of domestic products (P3DN), and the implementation of Local Currency Settlement (LCS). The findings suggest that enhancing economic resilience in developing countries facing protectionist trade shocks requires a coordinated policy mix integrating trade, industrial, monetary, and financial stability policies, while highlighting the strategic role of financial authorities in mitigating transmission risks from global trade disruptions to the domestic financial system.]]>
