Undeveloped Cooperative Deposit Insurance Similar to Bank Deposit Insurance: Critical Analysis From the Faithfulness of Appropriation and Dynamic Accountability

This study examines the potential development of a cooperative deposit insurance (CDI) scheme based on the principles of faithfulness of appropriation and dynamic accountability, which should be innovated and implemented by the Indonesian government. It first finds that the central government, through its agent, the Ministry of Cooperative and SMEs, has not authorised savings-loans cooperatives to conduct their businesses in a utilitarian capitalist framework, as evidenced by the lack of a CDI scheme. Second, it highlights the imbalance in social justice between savings-and-loans cooperatives and profit-driven business models, such as banks. Thus, the government should develop CDI as a business-investor protection model for capitalist utilitarianism. The government has not facilitated a social investor protection model for social utilitarianism. This study reveals that the government agency responsible for developing the CDI is unable to do so due to its limited power within the combination of a dynamic accountability framework and the faithfulness of appropriation.