Retail Payment Systems
In the OIC Member Countries
52
Nonetheless, branch and ATM expansion continues in Indonesia with the number of ATMs
doubling in the past six years.
In addition to commercial banks, the financial sector has an active microfinance component.
Targeting the poor and rural customers, the People’s Credit Banks (Bank Perkreditan
Rakyat/BPR) fulfil the traditional microfinance niche and provide limited credit and savings
products. While regulated as banks, BPRs may draw funds from the public only in the form of
deposits (time deposits, savings and/or other equivalent form of deposits), extend credit, and
place funds in designated financial instruments. BPRs are not permitted to participate directly
in the payments system, engage in equity participation, or conduct foreign currency or
insurance transactions. Most importantly, individual BPR operations are restricted to single
provinces, further limiting their ability to scale operations.
Central Bank Act, the UU No. 23/1999 on Bank Indonesia (17 May 1999), then amended with
UU No.3/2004 (15 January 2004) contains the legal basis for oversight and supervisory
function of the Central Bank. However, in 2011, the Financial Services Authority of Indonesia
(Otoritas Jasa Keuangan or OJK) was established under Act No. 21 of 2011 on Finacial Services
Authority that regulates and supervises the financial services sector. The OJK is an
independent agency that replaced the role of Bank Indonesia in regulating and supervising
banks. It also works to protect consumers of the financial services industry, along with
Bapepam-LK in regulating and supervising the capital market and financial institutions.
Large Value Payment Systems
Bank Indonesia [BI] is at the apex of the payment system in Indonesia and is empowered by
the Bank Indonesia Act 23 of 1999 to supervise banks and other financial institutions, conduct
monetary policy and oversee the payments system. Bank Indonesia also provides settlement in
central bank money for the RTGS system it operates, the government securities system and the
national clearing system. The main players in the payment system in Indonesia are banks that
include state banks, private banks, regional development banks and sharia banks.
The BI-RTGS system is the main system for handling payments and is also used for the
settlement of obligations arising from the other payment streams. The BI-RTGS links 149
participants to the central bank using a designated network. Of the 149 participants, 144 are
banks of which 2 are indirect participants; the remaining 5 are non-bank participants who
include Artajasa (through its ATM switching company), Posindo (the post office), Lintas Arta (a
switching company), Finnet (an e-money switching company) and more recently, the