The central bank’s spokesperson, Erwin Haryono, said that Indonesia plans to ditch Visa and Mastercard and is in talks with local businesses.
The Bank of Indonesia is preparing to phase out Visa and Mastercard while introducing its own domestic payment system, Antara news agency reported on Monday, citing the regulator.
Last week, Indonesian President Joko Widodo urged regional authorities to wean themselves away from foreign payment systems and start using cards issued by local banks. He argued that Indonesia needed to shield itself from geopolitical disruptions, citing the sanctions targeting Russia’s financial sector from the US, EU, and their allies over the conflict in Ukraine.
“Be very careful. We must remember the sanctions imposed by the US on Russia. Visa and Mastercard could be a problem,” he said.
Commenting on the initiative, the central bank’s spokesperson, Erwin Haryono, said that the regulator was in talks with local businesses “and the progress is about 90%,” adding that domestic cards will have many advantages, including lower fees. Also, according to him, “offshore settlements and dependence on foreign payment networks such as US Visa or Mastercard will no longer be necessary.”
Bloomberg reported that the US is studying how to guarantee all $18 trillion in US bank deposits.
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