Bank Indonesia Eases Policy, But Lending Rates Fall Only Marginally

Jakarta, CNBC Indonesia — Bank Indonesia continues to strengthen the effectiveness of monetary policy transmission to lower banking interest rates with the aim of driving higher economic growth.

“So far, the reduction in the BI-Rate by 125 basis points during 2025 and the expansion of monetary liquidity by Bank Indonesia has impacted the decline in various types of interest rates,” said Bank Indonesia Governor Perry Warjiyo at the BI Monetary Policy Decision press conference on Tuesday (17 February 2026).

The INDONIA interest rate declined 186 basis points since the start of 2025 to 4.16% on 16 March 2026.

Meanwhile, the SRBI interest rate for the 6, 9, and 12-month tenors declined by 191 basis points, 190 basis points, and 194 basis points respectively since the start of 2025 to 5.25%, 5.30%, and 5.33% on 13 March 2026.

The yield on State Securities for the 2-year and 10-year tenors stood at 5.99% and 6.88% respectively on 16 March 2026.

“The transmission of the policy interest rate decline to banking interest rates continues, although more limited,” said Perry.

One-month deposit rates fell 64 basis points from 4.81% in January 2025 to 4.17% in February 2026, indicating that banks’ efforts to reduce special rates offered to large depositors, currently representing 26.64% of total customer funds, need to continue.

The transmission of declining funding costs to declining bank credit rates is also being strengthened. Bank lending rates in February 2026 reached 8.80%, falling only 40 basis points from 9.20% in January 2025.

“Going forward, efforts to reduce bank funding and lending rates still need to be increased further in order to drive higher credit growth to support sustainable economic growth,” the BI Governor added.