With the enactment of Law Number 3 of 2011 concerning the Organization of Fund Transfers. Funds Transfer business activities continue to grow in Indonesia. This activity is very diverse, starting from non-bank services, then developing with service arrival services to the bank office, until finally the transfer activities are carried out without having to come to the Bank or non-Bank office, such as through ATMs, internet banking or through mobile banking services.
The activity of funds transfers also continues to grow and in accordance with the information technology development, it is becoming more borderless across nation. The allocation can be used for all interests, desired by service users, such as for payment of school fees, electricity bills, telephone bills, payment of business transactions and even for social purposes.
Business Scope Money Remittance in Indonesia:
Fund Transfers are the series of activities that begin with an order from the originating sender who aims to transfer some funds to beneficiaries that is mentioned in the fund transfer order until the funds is received by the beneficiary.
The required business license is Fund Transfer Provider’s License issued by Bank Indonesia. Regarding the status of a business entity that is allowed to become a fund transfer operator is only allowed for a Bank or non-bank corporate entity incorporated in Indonesia with the type of legal entity Company. However, in this case it is not rigidly regulated, whether it allows for the foreign ownership, but it can be concluded as long as it fulfills all the requirements stated in the regulations it is permissible.
The Capital Requirements to Establish Money Remittance in Indonesia:
Regarding the capital requirements, will determined based on the system used by the operator if the system can be used by another operator the amount of paid up capital at least IDR 500.000.000,- (five hundred million Rupiah), if it does not provide a system that can be used by another operator the amount of paid up capital at least IDR 100.000.000,- (one hundred million Rupiah). Furthermore, the status of office ownership is not explained rigidly, but in the process of inspection Bank Indonesia may conduct on site visit to the operator so it is not recommended to use Virtual Office, because Virtual Office has no “physical” business location.
The Procedure to Establish Money Remittance in Indonesia:
Regarding the procedure for obtaining Fund Transfer Provider’s License divided into this following stage:
1) Assestment of administrative documents.
2) Inspection which is on site visit by Bank Indonesia.
3) Bank Indonesia responds to the application for permission through an exit meeting (Bank Indonesia will officially inform their assessment result based on administrative and site visit inspection) and will declare whether they will reject, postpone (required to complete some additional requirements) or approve the application by issuing the license.
Please note that if Bank Indonesia has declared to approve the application, they will issue the Fund Transfer Provider’s License within 14 (fourteen) days after the exit meeting being held.
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