FEB Partners with LPS to Promote Banking Awareness

The Faculty of Economics and Business (FEB) at Universitas Muhammadiyah Surakarta (UMS), in collaboration with the Indonesia Deposit Insurance Corporation (LPS), held a workshop on Enhancing Understanding of the Role and Function of LPS within the Muhammadiyah Community in 2025. The event took place at the FEB UMS Auditorium on Thursday (15/5/2025).

“Understanding deposit insurance mechanisms has become crucial, especially in facing the rapidly evolving and complex dynamics of the banking industry,” said Anton in his opening remarks.

The agenda continued with presentations from two main speakers: Muhammad Sholahuddin, S.E., M.Si., Ph.D., Secretary of the Master of Management Program at FEB UMS, and Muhammad Arifin, Head of the LPS Education Team.

Sholahuddin elaborated from an academic perspective on the importance of LPS in maintaining the stability of the national financial system. He emphasized how public awareness of LPS’ existence contributes to the resilience of the banking sector amid global economic challenges.

“I think deposit insurance is not just about the nominal amount of money, it’s also about how the money we save in banks aligns with our values. Especially when we are guided by noble principles,” he explained.

The FEB UMS lecturer, Sholahuddin, also shared insights on financial management within organizations. According to him, every organization has its own goals, and financial officers must possess the skills to manage the organization’s finances effectively.

“Just imagine if an organization has funds but no proper financial management, what happens? It collapses. Everything falls apart. That’s the consequence.” said Sholahuddin, 

The second speaker, Muhammad Arifin, highlighted the strategic role of LPS as a guardian of public trust in the banking system. “When a bank goes bankrupt or is liquidated, the public need not panic. LPS is there to guarantee customer deposits in accordance with applicable regulations,” he explained.

Arifin emphasized the significance of LPS, especially in situations where banks close or undergo liquidation. In such cases, the public can still rely on deposit protection. He also underlined that the funds collected by banks are not merely stored, they are channeled into various sectors that support national development, such as public facilities and productive economic activities.

Head of the LPS Education Team, Muhammad Arifin conveyed this crucial message during his presentation at the FEB UMS Auditorium on May 15, 2025. UMS PR/Gede Arga

“LPS is not an insurance agency, In terms of institutional structure, LPS is a state institution at the ministerial level and falls under the category of Non-Ministerial Government Institutions (LPNK), similar to Bank Indonesia and the Financial Services Authority (OJK). Its operational funds come from premiums paid by the banking industry, not from the public.”

The session wrapped up with a lively discussion and Q&A, where both speakers tested the participants' grasp of LPS and its role in the national financial system. “If your answers are already correct, that means our job here is done, we can just have a chat,” Arifin quipped, sparking laughter from the audience.

One student, Adam, managed to correctly answer a question about the role of LPS and was promptly rewarded with a gift from the organizers. This outreach program was designed to deepen understanding and raise awareness among the younger generation, especially Muhammadiyah students, about the strategic importance of LPS in safeguarding the stability of Indonesia’s financial sector.

Writer: Genis Dwi Gustati

Editor: Maysali Sudarwati

Translator: Farizal Luqman Majid