JAKARTA -- Bank SMBC Indonesia, a subsidiary of Japan's Sumitomo Mitsui Financial Group (SMFG), plans to leverage its digital bank to expand its wealth management business, an increasingly important part of its growth strategy in Southeast Asia's largest economy following the sale of its pensions business last month.

SMBCI President Director Henoch Munandar told Nikkei Asia in an interview that the midsize bank is seeking to capitalize on growing interest among Indonesians, particularly younger generations, to "become investors, in the stock exchange, in the foreign exchange, in bonds." "Financial literacy is much, much better, rather than my generation who only put money in savings and deposits ... especially in urban areas," Munandar said.

Data released by Indonesia's Financial Service Authority (OJK) last month shows 30.27 million investors among the country's 284 million population, up from 19.1 million at the end of last year and double the number at the end of 2024. OJK said in April that 54% of all investors were under 30.

Indonesia's wealth management business is recording double-digit annual growth, Munandar said, on par with Singapore and Hong Kong.

Singapore's biggest bank, announced earlier this year that it plans to expand its wealth management business in Indonesia, and SMBC domestic rival MUFG Bank is also seeking to boost its wealthy customer base in Southeast Asia.

Henoch Munandar, the president director of SMBC Indonesia, says the bank is looking to boost its wealth management business.

SMBCI will use Jenius, its digital bank, and Indonesians' keen interest in Japan to help attract new business, the president director said. Founded in 2016, Jenius is Indonesia's oldest digital bank. It currently has 6 million accounts.

"In the past, we promoted Jenius for someone with a balance of $1, $2, $3, but now we have to focus on how to serve the $1,000 equivalent," said Munandar, who has been with SMBCI and its previous incarnations for 12 years and president director since 2022.

Although Jenius was designed to operate without branches, the digital bank plans to expand its network of lounge-style branches so that customers can build in-person relationships, Munandar said.

The first step will be the opening of a branch in Pondok Indah, an upscale area of South Jakarta. He also indicated plans to expand this network of lounge-style branches beyond Jakarta to major cities such as Surabaya and Makassar. "Now," he said, "we have to move closer to the city center business districts in order to attract attention and convenience for our target customers." SMBCI is the result of the 2024 rebranding of Bank BTPN, a pension savings bank under SMFG that specialized in providing loans to pensioners and others. The move was intended to strengthen the brand's presence in Indonesia as Japan's SMFG expanded in Asia.

Last month, SMBCI completed the sale of 19.9 trillion rupiah ($1.1 billion) worth of pension loans to state-owned PT Bank Tabungan Negara. As of June 2026, its consolidated assets were 245.5 trillion rupiah, loans totaled 185.3 trillion rupiah, and current and savings account (CASA) deposits grew 37.4% year on year to 60.1 trillion rupiah.

Munandar explained that following the sale of its pension business, SMBCI would realign its branch network from residential areas catering to pensioners to business districts. He declined to discuss targeted numbers but said the project would take two to three years. The company also plans to capitalize on the enduring popularity of travel to Japan, estimating that 600,000 Indonesians visit Japan each year.

The company also plans to capitalize on the enduring popularity of travel to Japan, estimating that 600,000 Indonesians visit Japan each year.

"If we can get, let's say, 10% ... or 20% [out of 600,000], [it] is a huge number of good segments that we [can] try to introduce our wealth management system," Munandar said.

While declining to give details, he suggested that "if you are a Jenius customer or our wealth management customer, we are working on special privileges and services to serve the wealth management segment." The government's recent moves to enact legislation will also provide a tailwind, Munandar said. OJK is reportedly planning to allow major banks to offer investment and commercial services in addition to catering to retail customers.

Munandar stated that this move is "in the final stage," assuming that the authority also aims to increase the competitiveness of financial products and services in Indonesia.

Munandar stated that this move is "in the final stage," assuming that the authority also aims to increase the competitiveness of financial products and services in Indonesia.

"We have the expertise in universal banking ... in digital [services]," he said. "We are also one of the pioneers despite a lot of challenges." Fee-based businesses from commercial and investment banking would be a "golden opportunity," he said, naming mergers and acquisitions, advisory, securities and bond trading to become less reliant on interest income from lending and funding.

The new legislation would also allow Indonesian banks to conduct derivative auctions "more progressively" to meet the needs of corporate banking in Indonesia rather than dealing only with Singaporean and Malaysian banks, he added.

Trioksa Siahaan, head of research at the Indonesian Banking Development Institute, described SMBC Indonesia as "already a bank to be reckoned with, although its scale is not yet on par with the largest domestic banks." He added that Jenius "has an advantage as a digital banking pioneer with relatively mature products, but it faces increasingly intense competition from ecosystem-based digital banks. Its challenge now is therefore not just to add users but to increase engagement, CASA deposits and monetization.

"The key to success is integrating Jenius as a gateway for young and affluent customers with wealth management and other SMBC services, enabling the bank to increase cross-selling, fee-based income, assets under management and customer loyalty."