Indonesia’s central bank mulls establishing e-money watchdog

Bank Indonesia raises concern on regulating e-money transactions for consumer safety.

As Indonesians increasingly use their cellphones to make purchases and conduct banking transactions, Bank Indonesia is calling for regulators to monitor the industry and guard consumer safety, the central bank said on Thursday.

More mobile-phone operators, from Telkomsel to Indosat and XL Axiata, now allow users to make transactions with their phone credits. 

“In theory, this trend is good for the economy,” said Ronald Waas, an accounting and payment director at the central bank. “It boosts bank transactions.” 

The problem, he said, is how people tend to think about the transaction. 

“I’m concerned about the way people see it,” he said. “[Phone credits] can’t replace money; there is a rigid definition of what we call money.” 

“People who make payments with mobile phone credits are bartering. We have to be careful how we should regulate it.” 

View the full story in The Jakarta Globe.