BI Continues To Finalize The Digital Rupiah Concept, These Three Main Aspects Are Called The Most Decisive

JAKARTA - Governor of Bank Indonesia (BI) Perry Warjiyo said that one manifestation of transformation in building a future digital central bank is the issuance of digital rupiah in the Central Bank Digital Currency (CBDC) scheme. According to him, there are three main aspects related to the issuance of a CBDC.

"First, the importance of issuing CBDCs as one of the central bank's mandates in the process of creating digital money reflects the pillars of a country's sovereignty and as the only legal tender," said Perry on Thursday, August 25.

Second, CBDC distribution can be done through wholesale and/or retail systems by adopting Distributed Ledger Technology (DLT).

Third, the development of conceptual design, building infrastructure that integrates payment systems with the money market in an integrated manner with other central banks that support the expansion of transactions between countries.

"Going forward, Bank Indonesia will continue to encourage the initiation of payment system integration between countries, especially the ASEAN+5 region, where currently there are already established collaborations with Thailand and Malaysia through support for the implementation of QR Cross Border and Local Currency Settlement (LCS)," he said.

Perry added that the future of the central bank needs to be supported by strengthening three other key aspects, namely the digital money creation process, optimizing technology in policy formulation, and strengthening green economic and financial measures.

“Through these three key aspects, the central bank must prepare itself well to face the new era of the digital and green financial economy. Central banks must take a leading role in navigating the economy to achieve sustainable and inclusive growth,” said Perry.

In the editorial notes, the development of the digital rupiah in the CBDC scheme is one response to the existence of crypto assets that have the potential to create new sources of risk for economic, monetary and financial system stability.

The majority of the world's central banks have started conducting research and experimental stages according to the characteristics of their respective countries. Meanwhile, BI continues to explore CBDC and at the end of this year is at the stage of issuing a white paper on digital rupiah development.