Government sukuk, also known as government Islamic securities are securities issued by Government of Indonesia through Ministry of Finance based on sharia principles as evidence of investment in an asset.
Retail Sukuk are a type of government sukuk issued to retail investors with a minimum purchase of IDR 1 million with a term of 3 years. Retail Sukuk provide a fixed rate of return. Retail Sukuk can also be traded on the secondary market therefore providing easy liquidity for investors.
Savings Sukuk is a type of government sukuk issued to retail investors with a minimum purchase of IDR 1 million. Savings Sukuk have a shorter term of 2 years, but it cannot be traded on the secondary market. However, Savings Sukuk have an early redemption option where investors can withdraw up to 50% of their investment funds. Savings Sukuk give floating-with-floor rate of returns where there is minimum return paid to investors regardless of the changes in the benchmark rate.
Waqf Sukuk or also known as Cash Waqf Linked Sukuk (CWLS) is a type of investment product that is quite unique where we can invest and donate (waqf) at the same time. Profits from the investment will be donated and distributed by waqf institutions (nazhir) through programs owned by nazhir. Investment in Waqf Sukuk can be started with a nominal value of IDR 1 million with a period of 2 years. Waqf Sukuk cannot be traded in the secondary market, so investors must invest until maturity (hold to maturity).
Government sukuk are issued with the aim of financing the State Budget (APBN) including financing state-owned projects. In addition, Government sukuk are also issued to support the development of the Islamic financial industry in Indonesia. The issuance of government sukuk has resulted in many infrastructure developments in Indonesia, including Youtefa (Holtekamp) Bridge (Papua), Musi 4 Bridge (Palembang), IAIN Salatiga Lecture Building, Solo - Ngawi Toll Road Section I Colomadu Karanganayar Central Java and many other developments.
The payment of nominal value and return of the government sukuk is fully guaranteed by the Government as regulated in Undang-undang no. 24 2008.
The issuance of government sukuk can be done in rupiah or foreign currency denominations. Generally, government sukuk are issued with the aim of institutional investors, but there are also issuance of government sukuk that aimed at retail investors. Government sukuk issued to retail investors have an additional purpose, namely to provide alternative investment instruments for domestic retail investors.
