The Indonesian Directorate-General of Budget Financing and Risk Management (DJPPR) under the Ministry of Finance has signed an agreement with the Indonesian Waqf Agency (BWI) to place US$100,000-worth of prize money from the IsDB into a cash Waqf-linked Sukuk (CWLS) instrument.
The cooperation will see the funds, which were awarded as part of the CWLS winning the IsDB Prize for Impactful Achievement in Islamic Economics in April this year, develop further CWLS instruments to fund social projects with the two parties acting as Waqf administrators.
In August this year, in an official visit with the Indonesian Financial Services Authority, or Otoritas Jasa Keuangan, and Bank Indonesia, the IsDB affirmed its commitment to develop the country’s Waqf sector.
“The cooperation involves Waqf-based project financing and leveraging Indonesia’s successful CWLS issuances to promote them among IsDB member countries,” a statement from the IsDB read.
The meetings also saw the parties commit to future collaborations to advance sustainable development.
With Indonesia securing a permanent seat on the IsDB’s board of directors with its special capital increase in the IsDB in May 2023, the development bank is set to further support the development of Indonesia’s Islamic finance sector through providing technical assistance and advisory services.
In addition to its collaboration with DJPPR, BWI has signed an MoU with Padjadjaran University (Unpad) in May this year. With the agreement, Unpad became the first university to place endowment funds into a CWLS instrument.
As part of its efforts to develop the instrument leveraging the ability of state colleges to collect endowment funds, BWI is targeting to receive IDR1 trillion (US$66.64 million) in contributions from colleges for CWLS in 2024.