Almost half of Indonesia's 238 million people live in urban areas, and most urban dwellers use on-site sanitation systems. Government policy recognizes the need for effective septage management systems but most existing septage treatment facilities are operating sub-optimally and less than 4 per cent of the faecal sludge generated is currently treated. This paper outlines the findings of field investigations of septage management in four cities undertaken by the World Bank's Water and Sanitation Program (WSP) as part of technical assistance to the Indonesian government. It summarizes the current faecal sludge management arrangements in the four cities, focusing particularly on the consequences of low demand for the financial viability of business models. Models based on ‘on-demand’ and scheduled tank desludging are explored in relation to their institutional and financial resource needs. The paper explores options for strengthening management systems and proposes an incremental approach to service improvement.