Chairman of Asbanda: BPD Must Become a Regional Financial Orchestrator, Not Just a Fund Distributor

Solo, 16 April 2026 - General Chair of the Regional Development Bank Association (Asbanda), Agus H. Widodo, emphasized that Regional Development Banks (BPD) must transform into a major force in regional economic management, in line with the dynamics of fiscal policy and pressure on Transfers to Regions (TKD). This was conveyed at The Asian Post Best Regional Champion Forum 2026 which was held in Solo, Thursday (16/4).

"In the future, regional economic strength will not only be determined by the APBD, but also by how strong the BPD is able to manage, mobilize and accelerate the flow of funds in the region," said Agus.

BPD Must Upgrade

In his speech, Agus emphasized that the role of BPD can no longer be limited to being a passive financial intermediation institution. "BPD must not just be a parking place for regional government funds. BPD must be upgraded to become an orchestrator of regional financial management, a guardian of liquidity stability, as well as an accelerator of regional economic growth," he stressed.

According to him, regional cash transfer policies have strategic implications for liquidity, development capacity and the sustainability of regional economic growth. Fiscal Challenges Become Momentum Agus also highlighted the pressure on TKD in the APBN which has the potential to narrow regional fiscal space, suppress development spending, and impact local economic activity.

However, he saw this condition as a strategic opportunity for BPD to take a bigger role. "This challenge is actually a momentum for BPD to optimize regional fund management, strengthen intermediation into the productive sector, and build a more integrated regional economic ecosystem," he explained.

Three Strategic Directions for Strengthening BPD

In the forum attended by the Director General of Regional Financial Development, the Chair of PERBAMIDA and the Main Directors and Directors of BPDs throughout Indonesia, Agus also explained the three main focuses for strengthening BPDs in the future, namely:

BPD as a Regional Economic Solution

Agus emphasized that in conditions of fiscal constraints, BPD has a strategic position as a solution in supporting regional development. "In the midst of fiscal constraints, BPD is a solution, not just a complement," he said. He also expressed his appreciation to Infobank Media Group for holding the forum which was considered consistent in encouraging improvements in the quality of the regional banking industry.

Encourage Synergy to Strengthen the Regional Economy

Through this forum, Asbanda hopes to create stronger synergy between the central government, regional governments, regulators and the regional banking industry in strengthening the role of BPD. "We are optimistic that BPD will be increasingly able to become a strategic partner for regional governments, guardian of regional financial stability, and a motor for sustainable economic growth," concluded Agus.