BI Broadens Scope of Sharia Monetary Operations

Bank Indonesia (“BI”) recently issued Regulation No. 22/14/PBI/2020 on Monetary Operations (“Regulation 14/2020”) in order to better accommodate the dynamics of the sharia money market by providing a sharia monetary operations instrument in the form of funding with securities as collateral which complies with sharia principles.[1]

Previously, matters relating to monetary operations were addressed under Regulation of BI No. 20/5/PBI 2018, which has been amended several times, most recently through the issuance of Regulation No. 21/16/PBI/2019 (“Regulation 5/2018”).[2]