Introduction

On November 26, 2025, Bank Indonesia (BI) issued Bank Indonesia Regulation Number 9 of 2025 on Macroprudential Liquidity Incentive Policies (“PBI 9/2025”), which took effect on December 1, 2025. PBI 9/2025 was issued to update the liquidity incentive provisions for the banking sector, covering Conventional Commercial Banks (BUK), Sharia Commercial Banks (BUS), and Sharia Business Units (UUS). PBI 9/2025 repeals Bank Indonesia Regulation Number 11 of 2023 on Macroprudential Liquidity Incentive Policies (“PBI 11/2023”) and aims to strengthen the intermediation function to better support national economic growth.

PBI 9/2025 responds to a financial cycle that is still below its long-term trend, calling for stronger credit and financing expansion. Against this backdrop, Bank Indonesia replaced the previous regulation with a more performance-based and forward-looking incentive scheme. The incentive mechanism also shifts from a historical, ex-post achievement approach to a commitment-based credit disbursement plan, ensuring that intermediation remains balanced, prudent, and aligned with BI’s policy direction.

Comparison

The following table compares PBI 9/2025 with PBI 11/2023:

Key Provisions

Concept of Performance-Based Incentives

Article 1 item 5 jo. Article 9 paragraphs (1) and (2) establishes a key change in the granting of Macroprudential Liquidity Incentives (KLM), namely incentives in the form of a reduction in the Statutory Reserve Requirement (GWM) obligation. KLM is no longer granted solely based on past credit realization, but instead on the Bank’s committed credit or financing disbursement plan and its alignment with Bank Indonesia’s interest rate policy direction. This provision requires bank management to formulate a more measurable business plan, as the targets set therein now directly determine the amount of liquidity incentives the bank may obtain.

Reporting Obligations and Administrative Sanctions

Reporting compliance forms a critical component of the new scheme. Article 10 paragraph (1) mandates banks to submit data covering the credit or financing disbursement plan commitment report and the Integrated Commercial Bank Report (LBUT). Article 11 stipulates that failure to submit, or late submission of, reports will result in administrative sanctions in the form of a written warning. Therefore, banks need to ensure their reporting systems are capable of providing commitment data in a timely and accurate manner.

Transparency and Incentive Notification Mechanism

To provide certainty for banking cash flow management, Article 13 stipulates that Bank Indonesia will convey information regarding the granting of KLM to Banks periodically. This information submission is conducted via letter or other media determined by BI. This allows banks’ treasury functions to promptly identify the amount of GWM reduction granted, enabling them to optimize the liquidity for new credit disbursement or other productive uses.

Authority for Exception of Incentive Granting

Banks must also manage regulatory risks arising from BI’s exercise of discretion. Article 14 grants authority to Bank Indonesia to exclude the granting of KLM to certain Banks, either partially or wholly, even if said bank may meet the quantitative criteria. This exception is based on Bank Indonesia’s assessment or other considerations, such as the bank's compliance with other macroprudential policy instruments.

Risk of Backward Correction (Clawback) Due to Inaccurate Data

Article 18 paragraphs (1) and (6) govern risk management provisions regarding data validity. If inaccuracies are subsequently found in the credit disbursement realization data serving as the basis for granting KLM, Bank Indonesia will conduct a re-examination and recalculate the incentives for up to the last 12 GWM fulfillment periods. Given this lengthy evaluation window, banks must safeguard data integrity to mitigate the risk of future clawbacks.

Financial Consequences of Recalculation Results

If the recalculation under Article 18 shows that a Bank has received incentives in excess of its entitlement, the Bank will be deemed to have failed to meet its Statutory Reserve Requirement (GWM) or Macroprudential Intermediation Ratio (RIM) Reserve obligations for the relevant period. Under Article 18 paragraph (4), the Bank must comply with the applicable monetary sanctions for the shortfall and return any excess remuneration or incentives received.

Adjustment of Incentives upon Strategic Corporate Actions

To support banking consolidation, Article 15 provides calculation certainty for Banks undertaking corporate actions. Bank Indonesia prescribes specific KLM calculation rules for banks undertaking mergers, consolidations, UUS spin-offs, or changes in business activities. In this process, Banks may be requested to submit additional supporting data so that the liquidity incentive calculation remains accurate following the restructuring.

Closing

PBI 9/2025 recalibrates the liquidity incentive framework and requires banks to strengthen their credit planning processes. For the banking sector, this regulation opens opportunities to lower the cost of funds through increased GWM incentives, provided the proposed credit growth targets are consistent with Bank Indonesia's policy and can be realized. Practically, banks need to immediately enhance data quality and credit planning processes, as credit disbursement commitments are now the primary basis for obtaining incentives, with potential consequences in the form of refunds or sanctions if such commitments are not supported by adequate data.