The P2SK Law For The Issuance Of Digital Rupiah By BI

Director General of Financing and Risk Management (DJPPR) of the Ministry of Finance Suminto (screenshot)

JAKARTA - The Director General of Financing and Risk Management (DJPPR) of the Ministry of Finance, Suminto, said that the presence of the Financial System Development and Strengthening Law (UU P2SK) could strengthen and clarify Bank Indonesia's mandate to issue digital rupiah.

"Regarding currency, this can be in the form of paper, metal, which can be in digital form. We regulate that in this law Bank Indonesia can issue digital currency," he said, quoted from Antara, Thursday, December 22.

Previously, Bank Indonesia had published a Digital Rupiah development design summarized in White Paper or a white paper that outlined the formulation of CBDC for Indonesia taking into account the principles of benefits and risks.

The issuance of this white book is the first step in the Garuda Project', which is a project that includes various exploration initiatives for various choices of the design of the Digital Rupiah architecture.

The idea of developing a Digital Rupiah is based on three main drivers, namely the need for Bank Indonesia as the sole authority in issuing currency to respond to digital developments in the fast economic and financial sectors.

In addition to trying to capture the development of digital technology, the P2SK Law also strengthens BI's independence, among others, by regulating so that the BI board of governors is not included as an administrator or member of a political party.

BI is also regulated to maintain the stability of the national financial system and support sustainable economic growth when carrying out its duties as the monetary authority that regulates the payment system and prudential macro.

"Including regulations regarding the money market and foreign exchange in Bank Indonesia's jurisdiction. We make close contact in the derivative market that investors are waiting for so that the derivative market is expected to develop," he added.