Moreover, based on preliminary data from Indonesia's central bank (Bank Indonesia), the money supply rose 10.2 percent (y/y) to IDR 4,911 trillion up to June 2017. This is nearly double the growth pace that was recorded in June last year.

Meanwhile, credit disbursement in Indonesia only rose 8.7 percent (y/y) to IDR 4,425.2 trillion. This is a slower pace and therefore seemingly indicates that consumers and companies are currently withholding spending and investment.

Anggoro Eko Cahyo, Head of Consumer Banking at Bank Negara Indonesia (BNI), said total third-party funds stored at BNI rose 18.5 percent (y/y) to IDR 463.9 trillion in the first semester of 2017, while its credit growth grew 15.4 percent (y/y) to IDR 412.2 trillion. He added that this is a sign that people are withholding spending. He added that demand for house ownership credit (in Indonesian kredit pemilikan rumah, abbreviated KPR) has also remained bleak.

Tony Prasetiantoro, Economist at the Gaja Mada University, said this trend was actually already visible last year. People are preferring to keep their funds on banks, implying banks receive plenty of third-party funds but struggle to sell it in the form of credit disbursement. This situation also affects banks' loan to deposit ratio (LDR).

Similarly, Bank Central Asia (BCA) saw its third-party funds rise by 16.7 percent (y/y) to IDR 572.2 trillion in H1-2017, while credit growth only grew by 11.9 percent (y/y) to IDR 433.3 trillion.

But the question here is how come Indonesians are hesitant to consume? There are various assumption. For example, political conditions have been plagued by tensions and uncertainties since the last quarter of 2016 (but would this really refrain people from consuming food products and clothes?). Another explanation would be that the cost of living has increased this year because the government cut electricity subsidies, raised taxes on cigarettes, while non-subsidized fuel also became more expensive. Structurally low commodity prices have also been cited as a factor (although this is not a new phenomenon).

But not everybody agrees with the assumption that Indonesian consumers are currently preferring to save their money on banks rather than consume, while - as a reaction to this - companies show limited demand for credit as they are unwilling to invest in business expansion when consumer demand is low. For example Bank Bukopin economist Sunarsip is not convinced about this trend and believes the third-party funds data are actually distorted due to the repatriation of funds under the government's tax amnesty program.