Kamis, September 22, 2022

DPR Approves Bill on Development and Strengthening of the Financial Sector

With the aim of encouraging contributions from the financial sector in relation to inclusive, sustainable and equitable economic growth in order to improve people’s living standards, reduce economic inequality and realize a prosperous, advanced and dignified Indonesia, the House of Representatives (Dewan Perwakilan Rakyat – "DPR") has just approved the Bill on the Development and Strengthening of the Financial Sector ("Bill"), which features a total of 339 articles spanning 24 chapters.
Alongside a number of chapters that contain general provisions, transitional provisions and closing provisions, the Bill also features various provisions that address the following areas: 1) Principles, purposes, objectives and scope; 2) Institutions; 3) Banking; 4) The capital market, money market and foreign exchange; 5) Insurance; 6) Joint-venture insurance; 7) The Policy Guarantee Program; 8) Financing service businesses; 9) Venture capital businesses; 10) Pension funds; 11) Savings and loan business activities, as undertaken by cooperatives; 12) Microfinance institutions; 13) Financial conglomerates; 14) Technological innovations within the financial sector; 15) The implementation of sustainable finance; 16) Financial inclusion and consumer protection; 17) Access to financing for micro-, small- and medium-scale enterprises; 18) Human resources; 19) Financial system stability; 20) Administrative sanctions; and 21) Criminal provisions.
In terms of the development and strengthening of the financial sector, the Bill sets out a number of institutional arrangements for financial sector authorities through the amendment and repeal of old regulations, as well as the stipulation of new regulations that deal with matters that were previously addressed under the following legal frameworks: 1) Law No. 9 of 2016 on the Prevention and Control of Financial System Crises; 2) Law No. 24 of 2004 on the Indonesia Deposit Insurance Corporation; 3) Law No. 21 of 2011 on the Financial Services Authority; 4) Law No. 23 of 1999 on Bank Indonesia; 5) Law No. 7 of 2011 on Currency.
The Bill stipulates that the rupiah currency now encompasses digital rupiah. Moreover, the issuance of digital rupiah is the responsibility of Bank Indonesia and must take the following aspects into account: 1) Monetary conditions; 2) Practicality as a means of payment; 3) Liquidity controls; 4) Inflation controls; 5) The balance of the money supply; 6) Security of data and information systems; 7) Mitigation of fraud risk; 8) Protection of public data; and 9) Community needs.

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With the aim of encouraging contributions from the financial sector in relation to inclusive, sustainable and equitable economic growth in order to improve people’s living standards, reduce economic inequality and realize a prosperous, advanced and dignified Indonesia, the House of Representatives (Dewan Perwakilan Rakyat – "DPR") has just approved the Bill on the Development and Strengthening of the Financial Sector ("Bill"), which features a total of 339 articles spanning 24 chapters.
Alongside a number of chapters that contain general provisions, transitional provisions and closing provisions, the Bill also features various provisions that address the following areas: 1) Principles, purposes, objectives and scope; 2) Institutions; 3) Banking; 4) The capital market, money market and foreign exchange; 5) Insurance; 6) Joint-venture insurance; 7) The Policy Guarantee Program; 8) Financing service businesses; 9) Venture capital businesses; 10) Pension funds; 11) Savings and loan business activities, as undertaken by cooperatives; 12) Microfinance institutions; 13) Financial conglomerates; 14) Technological innovations within the financial sector; 15) The implementation of sustainable finance; 16) Financial inclusion and consumer protection; 17) Access to financing for micro-, small- and medium-scale enterprises; 18) Human resources; 19) Financial system stability; 20) Administrative sanctions; and 21) Criminal provisions.
In terms of the development and strengthening of the financial sector, the Bill sets out a number of institutional arrangements for financial sector authorities through the amendment and repeal of old regulations, as well as the stipulation of new regulations that deal with matters that were previously addressed under the following legal frameworks: 1) Law No. 9 of 2016 on the Prevention and Control of Financial System Crises; 2) Law No. 24 of 2004 on the Indonesia Deposit Insurance Corporation; 3) Law No. 21 of 2011 on the Financial Services Authority; 4) Law No. 23 of 1999 on Bank Indonesia; 5) Law No. 7 of 2011 on Currency.
The Bill stipulates that the rupiah currency now encompasses digital rupiah. Moreover, the issuance of digital rupiah is the responsibility of Bank Indonesia and must take the following aspects into account: 1) Monetary conditions; 2) Practicality as a means of payment; 3) Liquidity controls; 4) Inflation controls; 5) The balance of the money supply; 6) Security of data and information systems; 7) Mitigation of fraud risk; 8) Protection of public data; and 9) Community needs.

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