Bank Indonesia Introduces Rule on Payment System

Bank Indonesia Regulation No. 22/23/PBI/2020 covers new grounds in regulating companies that provide payment services and infrastructures. The key elements of this regulation are as follows:

1. Instead of granting licences based on the types of product or functions offered, Bank Indonesia now regulates risks and activities, thus dividing payment system providers into front-end service providers (i.e. e-money issuers, e-wallet providers, and payment gateway providers) and back-end service providers (i.e. principals, switching providers, clearing providers, and settlement providers).


2. Bank Indonesia separates economic interests and voting rights in a front-end service provider. For example, while foreign investors can hold up to 85% of an e-money company (previously only 49%), only domestic parties can hold voting rights (thus being a controller of such provider).