OJK Issues Regulation to Strengthen BPR Capital and Competitiveness

The Financial Services Authority (OJK) has issued OJK Regulation (POJK) Number 7 of 2026 as an effort to encourage the Rural Bank (BPR) industry to increase its competitiveness through capital strengthening.

With strong capital, it is expected that these banks can achieve economies of scale in facing increasingly intense challenges and competition.

“Through strong capital, it is expected that BPRs can increase their competitiveness, perform their intermediary functions effectively, and absorb risks arising from their operational activities,” said OJK Chief Executive of Banking Supervision, Dian Ediana Rae, in a statement in Jakarta on Friday.

POJK Number 7 of 2026, concerning the Obligation to Provide Minimum Capital and Fulfilment of Minimum Core Capital for BPRs, will come into effect on 30 June 2026.

This regulation serves as an improvement to the previous regulation governing capital, namely POJK Number 5/POJK.03/2015.

Through POJK 7/2026, alignment is also being made with several existing laws and the latest accounting standards applicable to BPRs, including POJK Number 7 of 2024 regarding BPR and Sharia BPR, POJK Number 1 of 2024 regarding BPR Asset Quality, and SEOJK Number 21 of 2024 regarding Banking Accounting Guidelines for BPRs.

This regulation stipulates the fulfilment of minimum core capital through the addition of paid-up capital or contributed capital in the form of fixed assets, such as land and buildings, subject to certain requirements.

Furthermore, POJK 7/2026 provides relaxation regarding the deadline for completing administrative requirements for paid-up capital fulfilment, as well as adjustments to capital components, including the adjustment of fixed asset revaluation surplus balances to become a component of core capital.

In order to encourage the enforcement of minimum core capital fulfilment for BPRs, this regulation also outlines improved sanctions for BPRs that violate minimum core capital requirements.