BI Denied to be Indifferent to Economic Growth, Destry Responds!

Medan, CNBC Indonesia - The acting Governor of Bank Indonesia (BI), Destry Damayanti, has emphasised that the central bank is not only focused on maintaining the stability of the Rupiah exchange rate and inflation but also remains actively involved in driving national economic growth.

Destry refuted the assumption that BI prioritises stability while neglecting economic growth. “Regarding growth, the claim that Bank Indonesia is not concerned with growth is incorrect! We remain concerned with growth,” Destry stated during an online media briefing on Friday (3ly/7/2026).

She noted that maintaining stability and promoting growth cannot be achieved through monetary policy alone. Consequently, BI is optimising various other instruments, ranging from macroprudential policies to payment systems. One such measure involves providing liquidity incentives to the banking sector to increase credit distribution to priority sectors, including micro, small, and medium enterprises (MSMEs).

“For MSMEs and low-income communities, we are providing attention through the reduction of the Statutory Reserve Requirement (Giro Wajib Minimum - GWM) for banks that distribute credit to priority sectors, including MSMEs,” said Destry.

In the July 2026 Board of Governors Meeting, BI also established several policies to maintain stability while strengthening economic growth. On the monetary side, BI will continue to optimise foreign exchange market interventions through spot transactions, Non-Deliverable Forwards (NDF), and Domestic Non-Deliverable Forwards (DNDF) to maintain the stability of the Rupiah exchange rate. The central bank will also ensure adequate liquidity in the money and banking markets and keep inflation within the target of 2.5±1% for 2026-2027.

Furthermore, BI is expanding various incentives to attract foreign capital inflows, including increasing hedging transaction incentives and expanding the use of Local Currency Transactions (LCT) with partner countries. In the banking sector, BI is also increasing the Macroprudential Liquidity Incentive Policy (KLM) incentive to a maximum of 6% of Third-Party Funds (DPK), up from 5.5%, while introducing a new scheme to reduce liquidity segmentation and deepen the money market. This policy will take effect in September 2026.

To strengthen financing for productive sectors, BI is also refining the Macroprudential Inclusive Financing Ratio (RPIM). This policy expands the scope of credit distribution to inclusive sectors, including suppliers, distributors, and business partners, and strengthens the interbank MSME credit distribution scheme. This regulation will be effective starting October 2026.

In the payment systems sector, BI will accelerate digitalisation through the expansion of QRIS usage, including cross-border QRIS cooperation, digital innovation development through PIDI Digdaya and hackathon programmes, and the strengthening of the payment system industry while maintaining risk management principles and financial system stability.

Through this policy mix, BI reaffirms its commitment to maintaining a balance between macroeconomic stability and efforts to drive sustainable economic growth.

Details of the BI policy mix announced officially in the Board of Governors meeting as of July 2026 include:

1. Strengthening the effectiveness of monetary policy implementation to stabilise the Rupiah exchange rate and maintain inflation for 2026 and 2027 within the 2.5±1% target, by:

   1. Optimising foreign exchange intervention strategies to strengthen Rupiah stability through NDF transactions in overseas markets as well as spot and DNDF transactions in the domestic market;

   2. Managing the interest rate structure in the money market in line with the BI-Rate and pro-market monetary operation instrument interest rates;

   3. Maintaining adequate liquidity in the money and banking markets by ensuring primary money growth exceeds 10% (double digits) in accordance with monetary expansion;

2. Expanding incentive policies to increase foreign portfolio investment inflows and strengthen Rupiah stability, while accelerating money market deepening, by:

   1. Increasing and expanding premium reduction incentives for foreign portfolio investment, specifically: (i) increasing incentives for Sell-side Hedging Swaps (Buy-side Hedging Swaps to BI) from 10% to 12.5%, and (ii) expanding incentives for Sell-side DNDF to 15%;

   2. Providing incentives to increase Local Currency Transactions (LCT) with partner countries to diversify foreign exchange transactions, specifically: (i) adding premiums for Buy-side Hedging Swaps (Sell-side Hedging Swaps to BI) by 10%, and (ii) reducing premiums for Sell-side DNDF by 10%.

3. Increasing expansion and addressing liquidity segmentation in the money and banking markets by refining the Macroprudential Liquidity Incentive Policy (KLM) and its integration with accelerated money market deepening, as follows:

   1. Expanding the underlying transactions for repo in conventional monetary operations and/or Bank Indonesia Sharia-based Liquidity Management (PASBI) by adding corporate bonds and/or sukuk from PT Sarana Multi Infrastruktur (SMI) and PT Sarana Multigriya Finansial (SMF). These securities meet the requirements for corporate bonds/sukuk issued by government-established financial institutions, in line with BPPU 2030. This policy will commence no later than the end of September 2026;

   2. Refining the KLM for expansion and addressing liquidity segmentation, while continuing to encourage credit distribution to priority sectors, through:

      • Increasing the total KLM incentive amount available to banks to a maximum of 6.0% of Third-Party Funds (DPK), from the previous 5.5% of DPK;

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