OJK Regulates Foreign Workers in Banks with Limited Tenure

The Financial Services Authority (OJK) has issued Financial Services Authority Regulation (POJK) No. 1 of 2026 concerning the use of foreign workers and knowledge transfer programmes by commercial banks. This regulatory measure aims to strengthen governance frameworks for foreign worker utilisation in the banking sector whilst ensuring that knowledge transfer programmes to Indonesian workers are implemented optimally.

The regulation has been established to ensure that the use of foreign workers in banking provides added value to the development of national human resources competencies through structured knowledge transfer mechanisms.

The regulation was issued following several key considerations. Firstly, banks’ need for foreign workers must be aligned with the characteristics, business complexity, and strategic direction of each institution, whilst simultaneously promoting knowledge transfer to Indonesian workers in the banking sector.

Secondly, increased integration of global banking activities has driven cross-border labour mobility and knowledge transfer between financial institutions. This environment creates opportunities for Indonesian banking sector workers to gain experience and obtain international assignments.

Thirdly, there is a need to harmonise and align foreign worker regulations with current regulatory developments.

According to the POJK, banks in which 25% or more of shares are held by foreign citizens and/or foreign legal entities may employ foreign workers, but subject to several conditions.

Banks must ensure that the majority of board members are Indonesian citizens, that 50% or more of board and supervisory council members are Indonesian citizens, and that the majority of executive officers are Indonesian citizens.

Additionally, the tenure of executive officers, positions requiring specialist competencies, and technical experts or consultants is limited to a maximum of five years.