Indonesia’s financial sector has two paradoxes: 1) Indonesia has been a global leader in microfinance for the past 25 years, but access to microfinance services is declining; and 2) Indonesia’s commercial banks are liquid, solvent, and profitable, and the Indonesian economy has...

Although there is considerable debate among economists as to the impact of financial sector development on economic growth, empirical evidence indicates a strong, direct link between the two. A recent comprehensive review of both the theory and research on this link between financial sector...