Bank Indonesia (BI) has officially released a new scheme in the form\nof a foreign exchange (forex) market transaction facility for hedging\npurposes for global investors. The new scheme is called Vastra.<\/p>\n
The scheme is stipulated in Board of Governors Regulation (PADG)\nNumber 20 of 2026 concerning Foreign Exchange Market Transactions for\nHedging through Partner Banks, which has been effective since 23 July\n2026.<\/p>\n
BI Deputy Governor Thomas A.M. Djiwandono explained that the scheme\nis designed to make it easier for global investors to conduct hedging\ntransactions without having to deal directly with the constraints of\ndomestic market access or time zone differences.<\/p>\n
\u201cForeign exchange market hedging transactions through partner banks,\nor what we call Vastra. Vastra is a hedging instrument in which we open\na channel for global investors to conduct hedging transactions easily\nthrough banks abroad that are directly connected to partner banks in the\ndomestic market designated by BI,\u201d said Thomas at a press conference\nfollowing the BI Board of Governors Meeting (RDG), Wednesday\n(19\/8\/2026).<\/p>\n
With that note, Vastra is essentially a hedging mechanism for\nexposure to portfolio investment assets that investors already hold in\nIndonesia, not a scheme for making new portfolio investments.<\/p>\n
Therefore, the scheme is intended for foreign investors who already\nhold investment assets in the rupiah market, such as Government\nSecurities (SBN), Bank Indonesia Rupiah Securities (SRBI), or Bank\nIndonesia Sukuk (SUVBI), and are registered with BI under the term\nRegistered Global Investor (RGI).<\/p>\n
\u201cIn the initial phase, these hedging transactions will be supported\nby rupiah investment portfolios. The instruments currently supported are\nSBN, SRBI, and SUVBI, and going forward we will continue to expand\nthem,\u201d Thomas stressed.<\/p>\n
In practice, foreign investors holding rupiah-denominated assets face\nthe risk of exchange rate changes when they later convert the investment\nvalue into their home currency. The rupiah exchange rate can change\nbetween the time they enter and the time they exit the investment.<\/p>\n
When the rupiah weakens against the investor\u2019s home currency, the\nvalue of the investment converted back can decrease, so that part or all\nof the investment gains in rupiah can be eroded by exchange rate\nlosses.<\/p>\n
Therefore, with the hedging scheme through forward instruments,\ndomestic non-deliverable forwards (DNDF), and swaps facilitated by\nVastra, investors can lock in the forex transaction rate for a future\nperiod, so that the value of their rupiah assets is better protected\nfrom exchange rate volatility.<\/p>\n
In addition, with the Vastra scheme opening up space for back-to-back\nbank transactions, between the bank abroad where the investor submits\nthe transaction and the partner bank domestically, the time zone problem\ncan also be resolved, especially regarding the operational hours of\nbanking services in Indonesia.<\/p>\n
\u201cThe Vastra scheme is expected to accommodate hedging transaction\ndecisions by global investors, including in dealing with time zones and\nlimited direct access to the domestic market. With this, investors can\nalso be directly connected to BI hedging instruments, including DNDF and\nBI Swaps,\u201d said Thomas.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/bi-releases-scheme-to-protect-global-investors-rupiah-assets-from-exchange-rate-volatility-1787136827", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }