Central Bank clears WeChat Pay for Indonesia operations

Central Bank clears WeChat Pay for Indonesia operations

WeChat Pay Illustration. (Shutterstock)

We have an agreement signed between a BUKU IV Category Bank (CIMB Niaga) and WeChat with regard to payment methods using QRIS
Jakarta (ANTARA) - The Bank of Indonesia has finally agreed to the operations of one of China's most popular electronic payment platform, WeChat Pay, in Indonesia. The payment application, that uses the quick response (QR) code system, has been cleared to operate in Indonesia after it reached a partnership deal with PT Bank CIMB Niaga Tbk. Their payment system will follow the Quick Response Code Indonesian Standard (QRIS).

"We have an agreement signed between a BUKU IV Category Bank (CIMB Niaga) and WeChat with regard to payment methods using QRIS," said Deputy Governor of the Indonesian Central Bank, Sugeng to Antara in Jakarta, Wednesday.

A BUKU IV Bank means that the bank belongs to the IV category of commercial banks based on Business Activities (BUKU) list.

Before receiving clearance from the Central Bank, WeChat Pay had previously operated in Bali and had successfully attracted Chinese tourists to use their payment platform in their activities in the Island.

The Central Bank, together with the provincial government of Bali, had taken action against retailers that facilitated WeChat Pay's operations in Indonesia, as it has yet to meet the requirements listed in the regulations.

WeChat Pay, as a foreign payment service provider, had to comply with the provisions in the Regulation of the Members of the Board of Governors (PADG) Number 21/18/2019 regarding the Implementation of the National Quick Response Code Standard for Payment.

In the PADG, it was mentioned that they would have to establish a cooperation with a BUKU IV category bank in order to be listed as a domestic payment service provider.

"Article 18 and 19 reiterated that QR Code payment transactions using funded sources and/or payment instruments issued outside the Republic of Indonesia territory must be done in cooperation with BUKU IV banks," he said.

The BUKU IV bank which is cooperating with a foreign payment service provider will acquire the processes and transactions from the foreign party. At the same time, it also collects funds and has them settled for a minimum of 30 percent.

In addition to Wechat Pay, another payment system service company from China, Alipay is interested in operating in Indonesia. However, the Central Bank has yet to confirm the status of the permit application from Alipay. 

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