Bank Indonesia: Digital rupiah won’t cut out banks, fintech firms

Bank Indonesia says it would include non-bank financial institutions, such as fintech and digital wallet firms, as wholesalers in the CBDC system, alongside conventional banks.

JAKARTA: Bank Indonesia (BI) says its plans to establish a central bank digital currency (CBDC) will not disrupt existing banking and digital payment systems, as it seeks to elbow out cryptocurrencies and pave the way for cooperation with other monetary authorities.

The central bank announced on Monday that it would not offer interest rates on the so-called “digital rupiah” to avoid creating “head-to-head” competition with financial products created by banks, namely savings and time deposits.