Bank Indonesia overhauls Indonesia’s payment system

15 February 2021

The Indonesian Government is currently revamping the Indonesian payment system regime with its recent issuance of Bank Indonesia (BI) Regulation Number 22/23/PBI/2020 on the Payment System (PS Regulation), to be effective on 1 July 2021. The PS Regulation is intended to be an overarching regulation to reform Indonesia’s current payment system regime and supports the five initiatives under the Indonesia Payment System Blueprint 2025, unveiled by BI in 2019.

The PS Regulation attempts to shift the traditional regulatory approach for Indonesian payment systems frombeing“entity-based”tobecomingmore“activitiesandrisk-based”. WhilethePSRegulationcovers many topics, this client update will only focus on three aspects as discussed below: operator classifications; licensing; and ownership/control.

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