Indonesia's Hajj Fund Agency Proposes Managing Installment Payments

The Indonesian Hajj Financial Management Agency (BPKH) is pushing to incorporate installment payments for the initial and full Hajj deposits into its management system. Currently, an estimated Rp80 trillion in such funds sits within the Islamic banking industry, outside of BPKH's direct oversight.

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Because we found that reportedly the third-party funds in the form of installments for the full deposit plus installments for the initial deposit in the Islamic banking industry total Rp80 trillion which is not captured within BPKH. That should be within the BPKH ecosystem.

BPKH Head Fadlul Imansyah stated that bringing these funds under BPKH's management could boost its total managed assets to approximately Rp260 trillion. He explained that optimal returns from managing these installments could help alleviate the financial burden on pilgrims, preventing them from needing to pay extra fees closer to their departure.

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If the installment payments for the full deposit are included and managed, generating returns, then pilgrims won't need to top up or add more.

"If the installment payments for the full deposit are included and managed, generating returns, then pilgrims won't need to top up or add more," Fadlul said. Beyond financial gains, BPKH also emphasizes the need for robust oversight to ensure accountability and protect decision-makers involved in strategic investments. A clear governance mechanism, Fadlul believes, will minimize potential issues during investment processes.

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Strong oversight is needed to increase accountability and provide protection for managers in making strategic decisions.

BPKH hopes the proposed revision to the Hajj Financial Management Law will receive broad support. Fadlul acknowledged that policy formulation naturally involves differing viewpoints but stressed that strengthening governance will ultimately benefit Indonesian Hajj pilgrims. He views the effective management of Hajj funds as crucial for the nation's representation in handling these important religious finances.

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There is a tug-of-war in the policy formulation process, which is normal. What's important is how strengthening governance can provide greater benefits for Indonesian Hajj pilgrims.