Part 4 : Payment System - Bank Sentral Republik Indonesia
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November 18, 2018

The payment system in Indonesia is made up of cash payment and non-cash payment. The Principal Act of Bank Indonesia of 1953 stipulated that Bank Indonesia (BI) emitted only banknotes with denominations of five rupiah above, while the government was authorized to issue coins and banknotes in the fractions under five rupiah. The first banknote emitted by BI was banknote marked 1952 in seven denominations. Subsequently, pursuant to Act No. 13 of 1968, BI owned the sole right to emit banknotes and coins as valid payment instruments in all fractions. From this day, the government no longer emitted banknotes and coins. The first banknotes emitted by BI were the emission of 1970. In the era of 1990s, BI issued banknotes in major denominations of Rp 20,000 (1992), Rp 50,000, and Rp 100,000 (1999). BI did this to meet the needs of bank notes in major denominations in line with the economic development during that time. Meanwhile, in the non-cash payment system, BI began to establish itself as central calculation office shortly before 1954. As a central bank, from its early period, BI did its best to supervise and improve its cash payment system. In addition, BI was trying hard to improve its various cash payment systems in Indonesia and overseas. From 1980s to 1990s, Indonesia was enjoying a tremendous economic growth as well as a soaring transaction volume for non-cash payments. As a result, BI began to apply a more effective and sophisticated system to settle the non-cash payment transactions. A number of systems such as personal computer-based Semi Automated Local Clearance (SOKL) and Automated and Integrated Inter-office Fund Transfer (SAKTI) using paperless transaction system were continued to be developed and further improved. Finally, BI managed to come up with numerous electronic systems such as BI Information Assistance and Electronic Transaction (BI-LINE), Jakarta Electronic Clearing System (SKEJ), Real Time Gross Settlement (RTGS), Distance Clearing Information System (SIKJJ), intercity clearing, and Scriptless Securities Settlement System (S4). All these have made non-cash payments in Indonesia become easier.

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