Debt collecting rules to be revised after credit-card-holder`s death

The rules are clear that debt collection must be carried out according to the rules
Jakarta (ANTARA News) - Bank Indonesia Deputy Governor Halim Alamsyah said the bank would immediately revise the rules on debt collecting following recent violence against a Citibank credit card holder.

"We will seek ways on how debt collection could be carried out well without hurting customers," he said here on Monday.

He said the central bank has already made rules for debt collection by debt collectors which were changed in April 2010 like those implemented in the US and Australia.

He said under the Bank Indonesia Regulation (PBI) debt collector may not act harshly when collecting debt from customers.

"The rules are clear that debt collection must be carried out according to the rules. BI will review it although it is already contained in PBI Number 11/11/2009 on payment using credit cards," he said.

Halim said the regulation also states about prohibition of violent means use in debt collection.

"When a bank cooperates with a debt collectors the bank will be held accountable in case violation of regulations occur. Administratively it is Bank Indonesia that conducts evaluation on the bank concerned. If we found crimes in it we will then report to the police intelligence," he said.

Regarding sanctions on Citibank Halim said they would all depend the violation made although it would not go as far as revocation of license.

"But we will improve the bank`s standard operating procedures and seek a guarantee from the bank that the case will never happen again," he said.

Bank Indonesia head of public relations Difi A Johansyah said Bank Indonesia would give administrative sanctions to Citibank`s management because it had violated BI rules on responsibility on the use of a third party in credit card debt collection.

He said Bank Indonesia also had already issued a circular numbered 11/10/DSAP/2009 stating about the use of debt collector`s service.

Under the circular debt collector`s service may be used for collecting debts already categorized bad while use of violence is prohibited for it and the bank concerned must be responsible for it.(*)

(T.SYS/B/H-YH/A/A014) 04-04-2011 17:55:22

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