Bandung, IndonesiaSentinel.com — Bank Indonesia is continuing its focus on developing “Digital Rupiah”, a central bank digital currency (CBDC), as part of the 2030 Payment System Blueprint (BSPI). The project named “Project Garuda” keeps on progressing despite the fact that some central banks in developed countries have expressed no urgency in issuing their own digital currencies.
Digital Rupiah, is a rupiah in the form of electronic currency that is solely transacted and represented in an electronic format and would not exist in paper form. Similar to traditional paper rupiah, this digital currency could also be used to buy or sell almost any goods and services in Indonesia.
Ryan Rizaldy, Director of the Payment System Policy Department at Bank Indonesia (BI), stated that the digital currency is still in the development or trial phase. The digital rupiah has completed testing at the cash ledger level and is ready to progress further.
Currently in its “immediate state,” the initial design phase for the wholesale digital rupiah cash ledger has been tested for its basic functions such as issuance, destruction, and fund transfer. The project is now advancing to the securities ledger phase, focusing on the system’s security.
“We are moving towards testing the digital rupiah with the securities ledger, and once this is complete, we will proceed to explore cross-border transaction features,” Ryan said during a discussion in Nusa Dua, Bali, on Monday, August 26, 2024.
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Previously, Bank Indonesia Governor Perry Warjiyo outlined the timeline for the launch of the digital rupiah. The currency is expected to be integrated into the BI Payment System Blueprint within the next five years.
“Over the next five years, Bank Indonesia will be responsible for issuing three types of currency,” Perry said during the launch event for the 2030 Indonesian Payment System Blueprint at the Jakarta Convention Center on Friday, August 2, 2024.
Digital Rupiah Urgencies
The development of the Digital Rupiah in Indonesia aligns with similar efforts from G20 countries like the United States and the United Kingdom. However, Ryan emphasized that the central banks in these countries, especially some developed countries, have made it clear that they do not yet feel the urgency to issue a digital currency.
The digital currency remains a debate, considering the pros and cons behind this project. While the government could theoretically create a digital dollar that would make transactions faster and easier, there are also serious concerns and potential dangers.
In a recent press conference, Jerome Powell, Chairman of the U.S. Federal Reserve, stated that digital currencies currently remain in the study, exploration, and confirmation phases. It is emphasized that there is no urgency for the central bank to issue digital currencies in the near future.
(Raidi/Agung)
