IDEAS home Printed from https://ideas.repec.org/a/gam/jjrfmx/v17y2024i9p386-d1469059.html

Business Model and Strategy for Sustainable Lending of State-Owned Banks in Indonesia

Author

Listed:
  • Kepas Antoni Adrianus Manurung

    (School of Business, IPB University, Bogor 16151, Indonesia)

  • Hermanto Siregar

    (Department of Economics, Faculty of Economics and Management, IPB University, Bogor 16680, Indonesia)

  • Dedi Budiman Hakim

    (Department of Economics, Faculty of Economics and Management, IPB University, Bogor 16680, Indonesia
    International Center for Applied Finance and Economics (InterCAFE), IPB University, Bogor 16129, Indonesia)

  • Idqan Fahmi

    (School of Business, IPB University, Bogor 16151, Indonesia)

  • Tanti Novianti

    (School of Business, IPB University, Bogor 16151, Indonesia)

Abstract

Currently, banks are facing challenges in fulfilling the interests of stakeholders, not only from an economic point of view, but also in terms of environmental, social, and governance (ESG) aspects. This is due to the increasing concern for sustainability issues, including lending activities. Lending activities constitute the largest portion of bank assets and are the largest contributor to bank revenues. Thus, banks need certain business models and strategies to encourage sustainable lending growth; otherwise, it will be difficult for banks to fulfill stakeholder’s interests and support sustainable development goals. This study aimed to build a sustainable business model and select sustainable lending strategies in state-owned banks in Indonesia using a value chain approach. The development of a sustainable business model utilizing a triple-layer business model canvas (TLBMC) is based on the results of previous research and sustainability report data of the three state-owned banks. The formulation of strategy selection as the key driver of sustainable lending utilized the analytical hierarchy process (AHP) based on expert respondent data collected through questionnaires. This research showed that the lending distribution business model at state-owned banks in Indonesia, which was built using the TLBMC framework, can realize sustainability goals in the form of a sustainable lending business model. Furthermore, this sustainable business model can be used as a basis for selecting sustainable strategies. In addition, the AHP results yielded alternative strategies in the form of the market development and penetration of green loans and micro, small, and medium enterprises (MSMEs) as the key drivers of sustainable lending growth.

Suggested Citation

  • Kepas Antoni Adrianus Manurung & Hermanto Siregar & Dedi Budiman Hakim & Idqan Fahmi & Tanti Novianti, 2024. "Business Model and Strategy for Sustainable Lending of State-Owned Banks in Indonesia," JRFM, MDPI, vol. 17(9), pages 1-31, September.
    • Handle: RePEc:gam:jjrfmx:v:17:y:2024:i:9:p:386-:d:1469059
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1911-8074/17/9/386/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/1911-8074/17/9/386/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Michael Hergert & Deigan Morris, 1989. "Accounting data for value chain analysis," Strategic Management Journal, Wiley Blackwell, vol. 10(2), pages 175-188, March.
    2. Bruna Miranda & Catarina Delgado & Manuel Castelo Branco, 2023. "Board Characteristics, Social Trust and ESG Performance in the European Banking Sector," JRFM, MDPI, vol. 16(4), pages 1-17, April.
    3. He, Lingyun & Liu, Rongyan & Zhong, Zhangqi & Wang, Deqing & Xia, Yufei, 2019. "Can green financial development promote renewable energy investment efficiency? A consideration of bank credit," Renewable Energy, Elsevier, vol. 143(C), pages 974-984.
    4. Adriana Kocornik-Mina & Ramon Bastida-Vialcanet & Marcos Eguiguren Huerta, 2021. "Social Impact of Value-Based Banking: Best Practises and a Continuity Framework," Sustainability, MDPI, vol. 13(14), pages 1-40, July.
    5. Thomas Dyllick & Kai Hockerts, 2002. "Beyond the business case for corporate sustainability," Business Strategy and the Environment, Wiley Blackwell, vol. 11(2), pages 130-141, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Mololuwa Akinyemi & Ekene Cynthia Onukwulu, 2025. "Conceptual Framework for Sustainability in Action: Resource Management and Green Practices in Hospitality and Logistics," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 9(1), pages 736-744, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Biswanath Behera & Puspanjali Behera & Narayan Sethi, 2024. "Decoupling the role of renewable energy, green finance and political stability in achieving the sustainable development goal 13: Empirical insight from emerging economies," Sustainable Development, John Wiley & Sons, Ltd., vol. 32(1), pages 119-137, February.
    2. Fatih Akbaş & Ferudun Kaya, 2022. "Investigation of Financial Performance Indicators Affecting Corporate Sustainability of Participation Banks," Journal of Finance Letters (Maliye ve Finans Yazıları), Maliye ve Finans Yazıları Yayıncılık Ltd. Şti., vol. 37(117), pages 159-176, April.
    3. Ioana Gutu & Daniela Tatiana Agheorghiesei & Alexandru Tugui, 2023. "Assessment of a Workforce Sustainability Tool through Leadership and Digitalization," IJERPH, MDPI, vol. 20(2), pages 1-30, January.
    4. Jung Eon Kwon & Hyung Rok Woo, 2017. "The Impact of Flipped Learning on Cooperative and Competitive Mindsets," Sustainability, MDPI, vol. 10(1), pages 1-15, December.
    5. Rambaud, Alexandre & Richard, Jacques, 2015. "The “Triple Depreciation Line” instead of the “Triple Bottom Line”: Towards a genuine integrated reporting," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 33(C), pages 92-116.
    6. Maria Björklund & Helena Forslund, 2019. "Challenges Addressed by Swedish Third-Party Logistics Providers Conducting Sustainable Logistics Business Cases," Sustainability, MDPI, vol. 11(9), pages 1-15, May.
    7. Fan, Zhenqi & Cui, Jie & Wu, Wenjing, 2026. "Spatial spillover effect of green credit on carbon emission intensity in China: The role of high-quality productive forces," Economic Modelling, Elsevier, vol. 154(C).
    8. Katherin Carrera-Silva & Olga Maritza Rodríguez Ulcuango & Paula Abdo-Peralta & Ángel Gerardo Castelo Salazar & Carmen Amelia Samaniego Erazo & Diego Haro Ávalos, 2024. "Beyond the Financial Horizon: A Critical Review of Social Responsibility in Latin American Credit Unions," Sustainability, MDPI, vol. 16(18), pages 1-23, September.
    9. Qadri, Hussain Mohi ud Din & Ali, Hassnian & Abideen, Zain ul & Jafar, Ahmad, 2024. "Mapping the Evolution of Green Finance Research and Development in Emerging Green Economies," Resources Policy, Elsevier, vol. 91(C).
    10. Merriam Haffar & Cory Searcy, 2018. "Target‐setting for ecological resilience: Are companies setting environmental sustainability targets in line with planetary thresholds?," Business Strategy and the Environment, Wiley Blackwell, vol. 27(7), pages 1079-1092, November.
    11. Pishchulov, Grigory & Trautrims, Alexander & Chesney, Thomas & Gold, Stefan & Schwab, Leila, 2019. "The Voting Analytic Hierarchy Process revisited: A revised method with application to sustainable supplier selection," International Journal of Production Economics, Elsevier, vol. 211(C), pages 166-179.
    12. Hou, Mengyang & Xie, Yalin & Lu, Weinan & Cui, Xuehua & Xi, Zenglei & Han, Yuxin, 2025. "Green finance drives the synergy of pollution control and carbon reduction in China: Dual perspective of effect and efficiency," Energy, Elsevier, vol. 330(C).
    13. Zhao, Xing & Li, Xiangqian & He, Zhuoyi & Shi, Ruoying, 2024. "The relationship between the acquisition of corporate credit and the gender of executives: Evidence from developing countries," Finance Research Letters, Elsevier, vol. 62(PA).
    14. Priyanka Aggarwal & Archana Singh & Deepali Malhotra, 2025. "ESG Implementation in Indian NIFTY 500 Companies: A Comprehensive Multi-case Analysis of Strategy, Implementation, and Value Creation," South Asian Journal of Business and Management Cases, , vol. 14(3), pages 243-260, December.
    15. Florentina Moisescu, 2025. "Sustainability and Financial Performance: Exploring the Interconnections Through the Accounting Perspective in Romania," Economics and Applied Informatics, "Dunarea de Jos" University of Galati, Faculty of Economics and Business Administration, issue 2, pages 250-257.
    16. Mara Del Baldo & Maria-Gabriella Baldarelli, 2017. "Renewing and improving the business model toward sustainability in theory and practice," International Journal of Corporate Social Responsibility, Springer, vol. 2(1), pages 1-13, December.
    17. Per Engelseth & Richard Glavee-Geo & Artur Janusz & Enoch Niboi, 2020. "The Emergent Nature of Networked Sustainable Procurement," Sustainability, MDPI, vol. 13(1), pages 1-18, December.
    18. Francesco Di Maddaloni & Roya Derakhshan, 2019. "A Leap from Negative to Positive Bond. A Step towards Project Sustainability," Administrative Sciences, MDPI, vol. 9(2), pages 1-19, June.
    19. Zhang, Dongyang, 2023. "Does green finance really inhibit extreme hypocritical ESG risk? A greenwashing perspective exploration," Energy Economics, Elsevier, vol. 121(C).
    20. Rausser, Gordon & Chebotareva, Galina & Strielkowski, Wadim & Smutka, Luboš, 2025. "Would Russian solar energy projects be possible without state support?," Renewable Energy, Elsevier, vol. 241(C).

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jjrfmx:v:17:y:2024:i:9:p:386-:d:1469059. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager The email address of this maintainer does not seem to be valid anymore. Please ask MDPI Indexing Manager to update the entry or send us the correct address (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.