Thought leadership from our experts

The Implementing Regulation of the Payment Systems Regulation: Payment Services Providers

Following the issuance of Bank Indonesia Regulation No. 22/23/PBI/2020 on Payment Systems (“Payment Systems Regulation”) on 30 December 2020 which came into force on 1 July 2021 that serves as an “umbrella” regulation that provides a regulatory framework for the Indonesian payment systems industry, this advisory discusses what follows the Payment Systems Regulation, that is one of the two newly issued implementing regulations of the Payment Systems Regulation, ie. Bank Indonesia Regulation No. 23/6/PBI/2021 on Payment Services Providers (Penyedia Jasa Pembayaran ─ “PJP”) which was issued and came into force on 1 July 2021 (“PBI PJP”).

As discussed in the Advisory on the Payment Systems Regulation, the Payment Systems Regulation classifies payment systems services providers into two main categories: (i) PJP, which further regulated under the PBI PJP; and (ii) Payment System Infrastructure Providers (Penyelenggara Infrastruktur Sistem Pembayaran ─ “PIP”), which further regulated under Bank Indonesia Regulation No. 23/7/PBI/2021 on PIP. Upon this classification, the following types of licensed payment system services providers are now categorized as PJPs and they are subject to the PBI PJP:

1. Payment Gateway Providers;

2. E-Wallet Providers;

3. E-Money Issuers;

4. Issuers and Acquirers of Debit Cards and Credit Cards; and

5. Fund Remittance Operators.

This PBI PJP has 276 Articles in 11 chapters covering various topics, and it revokes the following regulations and provisions:

1. Bank Indonesia Regulation No. 11/11/PBI/2009 on the Organization of Card-Based Payment Instrument Activities and its amendment;

2. Bank Indonesia Regulation No.18/40/PBI/2016 on the Organization of the Processing of Payment Transactions;

3. Bank Indonesia Regulation No. 19/12/PBI/2017 on the Organization of Financial Technology;

4. Bank Indonesia Regulation 20/6/PBI/2018 on Electronic Money;

5. the provisions on the arrangement and supervision of payment systems of Bank Indonesia Regulation No. 18/9/PBI/2016 on the Arrangement and Supervision of Payment Systems and the Management of the Rupiah Currency; and

6. the provisions on licensing of Bank Indonesia Regulation No. 14/23/PBI/2012 on Fund Remittance. Other than the licensing provisions, fund remittance operators are still subject to this Bank Indonesia regulation on Fund Remittance.

Meanwhile, the implementing regulations of the regulations number 1. to 4. above remain in effect until 30 June 2022 as long as they are not contrary to the PBI PJP.

Given the broad scope of the PBI PJP, this advisory only focuses on the scope of activities of PJPs, the licensing requirements, the ongoing capital, the single ownership policy and restrictions on corporate actions, particularly the requirements which apply to non-bank entity PJPs.

The scope of activities of Pjps

Upon the issuance of the Payment Systems Regulation, the structure of the payments systems industry changed from an institution-based approach to an activity and risk-based approach. PBI PJP introduces the following complete scope of activities of PJPs:

The licensing requirements

1. License Categories

To engage in the above PJP activities, both new players and existing licensed payment system services providers must first obtain a PJP license.

Bank Indonesia issues 3 categories of PJP licenses depending on the activities of the PJP. A PJP License allows the PJP to engage in several activities, as long as the activities are in the same category. The license category determines the minimum paid up capital (initial capital) that the PJP must have as shown in the table below.

The Term of a PJP License

Generally, the PJP licenses issued by Bank Indonesia do not have a specific term. However, Bank Indonesia can determine a PJP license term if Bank Indonesia deems necessary, according to its license category, activity it engages in, and/or the processed sources of funds.

The Requirements to Obtain a PJP License

The following are the aspects of the requirements that must be satisfied by a party that applies for a PJP license:


The institutional aspect requirements regarding the ownership and control only apply to existing licensed payment system services providers as non-bank entity PJPs if, after 1 July 2021, a change is made to the share ownership composition by the foreign parties or there is a change in control by the foreign parties.

Ongoing capital

In addition to the initial capital, now a PJP must also meet certain ongoing capital requirements under the PBI PJP during the operation of its business activities. The ongoing capital consists of:

1. core capital, which includes:

a. the main core capital (modal inti utama); and

b. additional core capital (modal inti tambahan); and

2. supplementary capital (modal pelengkap).

The minimum ongoing capital for a non-bank entity PJP is calculated according to the payment systems capital requirement ratio with the following conditions:

1. at least 10% (ten percent) of the risk-weighted transactions (transaksi tertimbang menurut risiko) for all PJP classification (systemic, critical, general); and

2. additional capital requirements (surcharges) according to the PJP classification of:

a. 2.5% of risk-weighted transactions (transaksi tertimbang menurut risiko) for a PJP with a systemic impact2; and

b. 1.5% of risk-weighted transactions (transaksi tertimbang menurut risiko) for a PJP with a critical impact3.

The single ownership policy and restrictions on corporate actions

Under the PBI PJP, no party may hold:

1. shares constituting 25% (twenty five percent) or more of all the shares issued by a PJP with voting rights; or

2. shares constituting less than 25% (twenty five percent) of all the shares issued by a PJP with voting rights but it can be proven that the party concerned has control of the PJP, either directly or indirectly,

in more than 1 non-bank entity holding a license as a PJP in the same category and/or in more than 1 non-bank entity holding a license as a PJP and a determination as a PIP.

In addition, the PBI PJP also prohibits non-bank entity PJPs from taking any corporate action which will cause a change of the party which holds:

1. shares constituting 25% (twenty five percent) or more of all the shares issued by the PJP with voting rights; or

2. shares constituting less than 25% (twenty five percent) of all the shares issued by the PJP with voting rights but it can be proven that the party concerned has control of the PJP, either directly or indirectly,

within 5 years since the PJP license was issued the first time except with Bank Indonesia’s approval.


1 All USD figures assume an exchange rate of USD1 = IDR14,500

2 According to the PBI PJP, a PJP with a systemic impact means a PJP that has a systemic impact on the payment systems and/or financial systems in the event that the PJP experiences a disruption or failure.

3 According to the PBI PJP, a PJP with a critical impact means PJP that has a critical impact on the payment systems and/or financial systems in the event that the PJP experiences a disruption or failure.