Bank Indonesia regulates use of Rupiah in international transactions
28 July 2022
Bank Indonesia (“BI”) Regulation PBI No. 24/6/2022 on the Use of Rupiah in International Activities (“Regulation”) entered into force on 27 April 2022.
The Regulation sets out requirements regarding the use of the Rupiah outside Indonesia and by non-residents within Indonesia.
The Regulation notes that the utilisation of the Rupiah outside Indonesia is prohibited for both residents and non-residents but also provides that BI may introduce exemptions taking into account BI’s policy to promote the use of the Rupiah in international activities, benefits to the national economy and the stability of the financial system and any other considerations.
The Rupiah may be used offshore physically (that is, coins and bank notes), via Rupiah-denominated bank accounts, and through digital financial instruments.
A non-resident of Indonesia is permitted to use the Rupiah within Indonesia for the following underlying economic activities as specified in the Regulation - current transactions, financial transactions, capital transactions, and other underlying transactions as determined by BI. A “non-resident” refers to an individual or entity not domiciled in Indonesia or resident in Indonesia for less than one year.
Additional details on the offshore use of the Rupiah and onshore use by non-residents will be provided in future BI regulations.