The Bank of Indonesia will publish the concept of a national digital currency (CBDC) by the end of 2022. Bloomberg reports, citing Perry Warjio, head of the central bank.<\/p>\n
The Bank of Indonesia is preparing to issue a digital rupiah for interbank and international transfers. It is currently working on the cybersecurity of the instrument.<\/p>\n
\n“The digital rupiah will be on par with cash and will become the sole legal tender for digital transactions in Indonesia,” said Warjio.<\/p>\n<\/blockquote>\n
The central bank intends to roll out the CBDC among major banks and payments-service providers, who will collaborate with smaller financial institutions for retail transactions.<\/p>\n
\nThis will help avoid the classic problem of disintermediation<\/span>, when households would prefer to conduct transactions directly through a \u201crisk-free\u201d central bank rather than through ordinary banks, especially in crisis periods,<\/p>\n
said Wellian Wiranto, an economist at OCBC.<\/p><\/blockquote>\n
The Bank of Indonesia first announced plans to issue a CBDC in 2018. In May 2021, the regulator confirmed its intention<\/a>, without specifying launch timelines.<\/p>\n
In November, the department described the deployment of the digital rupiah as one of the ways to combat cryptocurrencies<\/a> in the country. The central bank described the CBDC as a \u201cmore reliable alternative\u201d.<\/p>\n
In 2021, Indonesian financial institutions were prohibited from using Bitcoin<\/a> and other digital assets as a means of payment.<\/p>\n