Jakarta: Bank Indonesia (BI) Governor Perry Warjiyo outlined Indonesia's Payment System (IPS) 2025 Visions at an international seminar dubbed 'Digital Transformation for Indonesian Economy' in the capital city of Jakarta on Monday.
"The visions are an optimal response to the recent proliferation of digitalisation that has significantly altered the risk landscape, namely through cyber threats, monopolistic competition and shadow banking, which could undermine the effectiveness of monetary controls, financial system stability and sound payment system," the central bank said in a press release on Monday.
The IPS 2025 Visions are: First, reiforces the integration of national digital economy and finance in assuring the proper functioning of central bank mandate in money circulation, monetary policy, and financial system stablility as well as financial inclusion.
Second, fasters digital transformation within the banking industry to sustain banks role as a primary institution in the digital economy and finance through the implementation of open-banking standard as well the deployment of digital technology and data on their financial product and services.
Third, assures interlink between Fin-Tech and banks to contain the escalation of shadow-banking risk through the regulation of the use of digital technology (e.g. Application Programming Interface-API), business relation, and business ownership.
Fourth, indemnifies the balance among innovation, consumer protection, integrity, and stability as well as fair competition through the implementation of digital Know Your Customer (KYC), Anti-Money Laundering and Combatting the Financing of Terrorism (AML/CFT), data/information/public business openness, and the deployment of Reg-tech and Sup-tech for reporting, regulatory and supervisory.
Fifth, safeguards national interest on cross-border use of digital economy and finance through the obligation of domestic processing for all onshore transactions and domestic partnership for all foreign players under the consideration of reciprocity principle.
The five IPS 2025 Visions will materialise through five initiatives to be implemented directly by Bank Indonesia in pursuance of the central bank's duties and jurisdiction, as well as implemented through productive collaboration and coordination with relevant government ministries and institutions, also the industry.
As a preliminary step towards digital transformation of the national payment system and to help accelerate digital economic and financial development, Bank Indonesia held a soft launching for the QR Code Indonesia Standard (QRIS).
QRIS will allow all QR payments to interconnect and interoperable using only one standard QR Code. Initially, Bank Indonesia will introduce QRIS to Merchant Presented Mode (MPM), with implementation commencing in the latter half of 2019.