Indonesia: Payment System Blueprint 2030 – Indonesia Advances

brief

As a sequel to the Payment System Blueprint 2025 (see our November 2019 Client Alert), which has led to the successful implementation of several key initiatives such as (i) continued domestic and cross-border implementation of the Indonesian Quick Response Code Standard (QRIS) (see our August 2019 and September 2022 Client Alerts), (ii) the National Open API Standard (SNAP) (see our August 2021 Client Alert), (iii) Real-time Payment Infrastructure (BI-FAST) and (iv) Regulatory, Licensing and Supervisory Reforms (see our January 2021 Client Alert), Bank Indonesia has now published the Payment System Blueprint 2030 (“2030 Blueprint“).

The main objectives of the 2030 Blueprint are to ensure the resilience of payment systems to economic and technological challenges and to integrate the various payment systems to create a more efficient and cohesive structure.

Future policies and regulations on interconnection between non-bank institutions and banks, including in the payment field

The continued growth and interconnectedness between banks, non-banks (e.g., payment service providers, finance companies, and insurance companies), and non-financial service providers (e.g., e-commerce, ride-hailing, gaming) requires greater focus and careful definition of the roles and responsibilities of these players. This is critical from both an association/ownership perspective and a business collaboration perspective.

Business models are becoming increasingly modular, resulting in a single payment service involving numerous entities. Going forward, we expect policies and regulations to be developed that set minimum standards or prerequisites for risk management. These include clearly identifying the entities that will bear liability if risks materialize. Supervision of entities involved in such collaborations could be strengthened. This could involve stricter regulatory oversight and the implementation of strong consumer protection measures.

Future licensing and development approval policies and regulations based on market contribution and risk management

Bank Indonesia is expected to develop criteria such as size, interconnectedness, capabilities, IT infrastructure, complexity and substitutability to assess the market contribution and risk management of payment service providers. These criteria could guide the level of scrutiny and supervision Bank Indonesia uses when developing licensing requirements or evaluating proposals for approval of new product or activity development.

To achieve the vision of the payment system in 2030 and support the above-mentioned commercial applications, the 2030 Blueprint covers five initiatives:

Infrastructure

Focus on building a resilient and integrated digital financial infrastructure. Specific measures include:

• Enhance the stability, scalability and interoperability of retail payment systems
• Developed the “BI-Payment Clear” system to strengthen risk management and ensure transaction integrity
• Building a strong data infrastructure by implementing Payment ID (to be developed as a unique identifier to optimize granular financial transaction data), data capture system and “BI-Payment Information” (a public digital infrastructure that provides APIs (Application Programming Interfaces) for processing granular financial transaction data (Data as a Service)

industry

The industry will become stronger by matching entry rules to the risk levels of participants, improving risk management and updating regulations. This will help the industry better control risks and remain competitive.

The 2030 Blueprint builds on the vision outlined in the 2025 Blueprint and aims to oversee digital technologies such as APIs, promote commercial partnerships, and regulate the ownership of payment system participants. The aim is to reduce potential risks posed by shadow banking and ensure strong links between fintech and traditional banking institutions.

Innovation

Bank Indonesia is committed to promoting innovation while focusing on protecting consumer rights, integrity, stability and healthy business competition through cooperation. This goal will be achieved through strategic policy measures, including: (i) promoting innovation in payment services, with a focus on establishing the Bank Indonesia Digital Innovation Center; and (ii) strengthening consumer protection measures.

International

Expand the scope of QRIS cooperation among countries, achieve interconnection and interoperability of retail and wholesale payment systems, enhance cross-border payment connectivity, and safeguard national interests.

Digital Rupee

In 2024, Bank Indonesia successfully completed the first phase of development, which involved using wholesale digital rupiah for various functions such as issuance, destruction and transfer of funds between parties. Looking ahead to the second phase, the focus will shift to enhancing capabilities through digital securities trials, targeting a range of financial market use cases.

* We would like to thank Johan Kurnia, Senior Partner at HHP Law Firm, for his contribution to this alert.

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