Highlights:

1.             This Circular Letter specifies the technical rules for implementation of Bank Indonesia Regulation No. 10/6/PBI/2008 concerning the Bank Indonesia Real Time Gross Settlement System (RTGS Regulation).

2.             This Circular Letter of Bank Indonesia sets forth, among others, brief explanations of the general regulatory principles stipulated in the RTGS Regulation, including but not limited to the principles that:

a.             The operation of the BI-RTGS System must have a well founded legal basis;

b.             The Operator must prepare rules and procedures providing clarity to Participants concerning the financial risks to Participants from their participation in the BI-RTGS System;

c.              The operation of the BI-RTGS system must be supported by clear procedures for management of payment system risks;

d.              The Operator must ensure that the BI-RTGS System design is capable of assuring that Settlement is conducted in real time and is final and irrevocable;

e.              Settlement shall be performed using the available funds in the Settlement Accounts of Participants at Bank Indonesia;

f.               The BI-RTGS System must operate with a high level of security and be available throughout the established operating hours. It must also be equipped with procedures for handling malfunctions and/or emergencies.

g.              The operation of the BI-RTGS System must be efficient and practical so that it benefits all Participants and the economy as a whole;

h.              The Operator must ensure objective and transparent criteria for participation; and

i.                The Operator must apply effective, accountable and transparent good governance.

3.             In addition to the brief explanations of the general regulatory principles explained above, this Circular Letter also prescribes regulations concerning:

a.              Categories of transactions that must be processed through the BI-RTGS System; and

b.