Early History Indonesia Has Its Own Currency

JAKARTA - Today, September 30, 74 last year or in 1946 Oeang Republik Indonesia (ORI) was circulating as the only legal means of payment. At the age of one year of independence, Indonesia finally had its own currency. So how can ORI spread and replace the currency used previously?

Through the Decree of the Minister of Finance dated 29 October 1946 delivered by Vice President Mohammad Hatta, ORI was officially circulated. Before the existence of ORI, Indonesia used a common currency, namely De Javasche Bank money, Dutch East Indies money and Japanese money.

Quoting the kemenkeu.go.id page, before the ORI was disseminated, the Indonesian Government withdrew the invasion money from the Japanese and the Dutch East Indies Government from circulation. The withdrawal was carried out gradually by imposing restrictions on the use of money and prohibitions on bringing money from one area to another.

In addition, the Japanese invasion money and the Dutch East Indies money could not be issued from Java and Madura and also could not be transferred to areas outside Java and Madura. The ORI value through the Act of 25 October 1946 was stipulated that ten rupiah was the same as five grams of pure gold, the ORI exchange rate against Japanese money was 1:50 for Java and Madura, and 1: 100 for other regions.

The issuance of ORI was not only a replacement for existing payment instruments, but also to demonstrate the sovereignty of the Republic of Indonesia. At that time Indonesia was hit by severe inflation and the issuance of the ORI was hoped to be able to nourish the Indonesian economy. At the beginning of the circulation of the ORI, each resident was given Rp1 to replace the remaining money from the Japanese invasion which was still used until 16 October 1946.

However, at that time, ORI's distribution could not reach all parts of Indonesia. This is due to several factors, namely transportation factors, security problems and parts of Indonesia that are still under the position of the Netherlands.

"The people's struggle, especially about getting ORI money into the areas occupied by the Dutch, was still carried out despite a thousand and one kinds of disturbances, sometimes with torture, murder and humiliation, as a sign of loyalty to the Republican Government," noted the archive of the Siliwangi Brigade Army Headquarters, 9 December 1946.

The difficulty in distributing ORI has made the central government give authority to certain local governments to issue a special currency, Oeang Republik Indonesia Daerah (ORIDA). The currencies are only temporary and only valid in the respective regions determined by the central government.

ORI and ORIDA were only valid until January 1, 1950, then continued with the issuance of the Republic of the United States of Indonesia money. However, the implementation of RIS money also lasted briefly because the Unitary State of the Republic of Indonesia (NKRI) was re-formed.