A domestic card will be used for budget spending free of charge, a banking executive has said
The Bank of Indonesia (BI) has launched a domestic card payment system as part of a greater strategy to reduce reliance on foreign systems and protect transactions from geopolitical disruptions, CNBC Indonesia reported on Monday.
Based on Indonesia’s interbank system, Gerbang Pembayaran Nasional (GPN) or the National Payment Gateway is designed for state companies and institutions and will replace Visa and Mastercard as the country seeks more autonomy over its payment infrastructure by minimizing the role of foreign payment providers, the outlet said.
According to Dicky Kartikoyono, the head of the Payment System Policy department at BI, domestic cards process users’ private data within the country and do not charge any fees.
The card also provides features needed for government institutions to conduct payments such as budget spending on inventories, rent, building maintenance and official travel, Kartikoyono said.
“We are launching a government payment card, which we are calling the Indonesian credit card. It will facilitate the use of the budget in an efficient manner and provides various opportunities that will encourage medium and small businesses,” he added.
Indonesian President Joko Widodo earlier urged regional authorities to wean themselves off of foreign payment systems and start using cards issued by local banks. He argued that Indonesia needed to shield itself from geopolitical fallout, citing the sanctions targeting Russia’s financial sector from the US, the EU, and their allies over the conflict in Ukraine.
In March, Dodit Proboyakti, a board member of the Indonesian Credit Cards Association (AKKI), told RIA Novosti that Indonesia would apply the working knowledge of Russia and its Mir payment system to promote the domestic financial network.
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.
For more stories on economy & finance visit RT’s business section
You can share this story on social media:
Follow RT on![RT]()
Comments are closed.