Good News For Credit Card Users! Bank Indonesia Extends Penalty Reduction Period Until December 31

Illustration (Photo: Doc. Antara)

JAKARTA - Bank Indonesia (BI) has stated that it will extend the policy on reducing the value of fines for late credit card payments by 1 percent of the outstanding or a maximum of Rp. 100,000.

BI Governor Perry Warjiyo said the regulation was valid until the end of this year or until December 31, 2021.

"This step was taken with the intention of encouraging the use of credit cards in the community," he said at an online press conference on Thursday, June 17.

Perry added that this latest policy is expected to be able to increase consumption activities in order to spur the wheels of the economy that have been depressed due to the impact of the COVID-19 pandemic.

"The use of credit cards is a buffer for public consumption in order to support the national economic recovery," he said.

Previously, the Minister of Finance (Menkeu) Sri Mulyani revealed that the middle class tends to hold back consumption activities during the current pandemic. This assumption is based on the use of credit cards, which are still in a sloping and even declining trend.

“For this group, it's not a matter of purchasing power, they actually have money. In fact, the money owned increased. But the main problem is whether the pandemic confidence is controlled or not," said the Minister of Finance in a Working Meeting with Commission XI of the Indonesian House of Representatives at the Senayan Parliament Complex, Jakarta some time ago.

Furthermore, the former IMF and World Bank boss predicts that a reversal of the situation will occur when the movement of the pandemic rate is completely under control.

"Once they have exercised their purchasing power, there will be a demand for the banking intermediation function (credit)," he said.

To note, BI itself has set a loosening of credit card regulations by lowering the maximum credit card interest rate limit from 2 percent to 1.75 percent per month.

Meanwhile, the value of payment transactions using ATM cards, debit cards, and credit cards in May 2021 grew 21.03 percent year-on-year (yoy) with a total of IDR 689.7 trillion in line with the increase in economic activity and community needs ahead of Eid al-Fitr this.