Indonesia to impose tighter rules for credit cards

Bank Indonesia will revise credit card rules to require a minimum age and salary, capping the number of cards owned, limiting maximum interest rates and regulating the debt collection process.

“We view it as necessary to improve the standards, so that on one side the customers are better protected and on the other side issuers could be more prudent to mitigate disadvantages,” he told reporters without providing details of the regulation," BI Governor Darmin Nasution said.

According to Darmin, two cards are enough for one customer, while the existing interest rate of 3.5 to 3.75 percent per month is considered “too high”.

“There are people who have credit cards from many issuers, while their salaries are inadequate. That means they are given facilities to be trapped,” he said.

The rules would be issued within the month, with most of the points being effective as of the beginning of 2013, said Ronald Waas, the central bank’s director for accounting and payment systems.

“Issuers will also be required to be transparent on how they charge interest rates, when the interests are being imposed and what can be charged with interest. Those need to be explained to prospective customers,” he said.

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