Bambang Daru Nugroho, Tarsisius Murwadji
Indonesian banking is very slow in responding to the rapid development of the global paradigm and information technology, so that business actor in the millennial and digital era is finding their own way to obtain business capital. Nowadays, Indonesian Banking still focuses on collateral that held by prospective debtor customers, not the quality of their performance. The traditional paradigm of Indonesian banking that prioritizes excessive bank safety encourages the emergence of shadow banking, namely business actors in the form of non-bank corporations that conduct banking business activities both registered and those not registered with the Financial Services Authority (OJK). In order to overcome the negative impact of shadow banking, it is necessary to reengineering the Indonesian banking business through a performance guarantee system that replaces the collateral system. In addition, business reengineering through the performance guarantee system can also be applied in changing the objectives and functions of Indonesian banking in order to face the industrial era 4.0. The principle applied is the principle of kinship that is in line with Indonesian traditional wisdom.