Asia’s fourth biggest economy might have its own payment system ready next month, according to RIA Novosti
The Bank of Indonesia will launch its domestic card payment system in May as part of a strategy to reduce dependency on foreign systems and protect transactions from geopolitical fallout, RIA Novosti news agency reported on Monday.
Central bank Governor Perry Warjiyo reportedly said the country is officially launching physical domestic cards “in close cooperation with the government and the Indonesian Credit Card Association (AKKI).”
In March, the regulator announced it was preparing to phase out Visa and Mastercard as it seeks more autonomy over its payment infrastructure by minimizing the role of foreign payment providers.
Indonesian President Joko Widodo earlier urged regional authorities to wean themselves off foreign payment systems and start using cards issued by local banks. He argued that Indonesia needed to shield itself from geopolitical disruptions, citing Western sanctions targeting Russia’s financial sector over the conflict in Ukraine. “We must remember the sanctions imposed by the US on Russia. Visa and Mastercard could be a problem,” he warned.
Indonesian Credit Card Association’s board member Dodit Proboyakti recently told RIA Novosti that Jakarta would apply Russia’s experience with its Mir payment system to promote the domestic financial network.
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Moscow rolled out its own national card system, Mir, soon after the US first targeted the country with sanctions in 2014, and created the domestic National Payment Card System (NSPK) to smoothly take over all Visa and Mastercard transactions should the US-based companies pull the plug.
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April 24, 2023 at 07:30PM