Board of Governors Member Regulation Number 13 of 2026 Lowers the Mandatory Documentation Threshold for Foreign Exchange Transactions to Above USD25,000

Introduction

On 18 June 2026, Bank Indonesia issued Board of Governors Member Regulation Number 13 of 2026 on the Fourth Amendment to Board of Governors Member Regulation Number 21/28/PADG/2019 concerning the Monitoring of Foreign Exchange Traffic Activities of Banks and Customers (“PADG 13/2026”), which will take effect on 1 July 2026. This regulation aims to strengthen monitoring instruments for all foreign exchange traffic activities facilitated by the banking sector.

In addition, PADG 13/2026 seeks to ensure and maintain that every foreign exchange transaction is genuinely based on a legitimate real economic activity (underlying transaction). To enhance the effectiveness of such monitoring in practice, Bank Indonesia considers it necessary to intervene by readjusting the nominal transaction value threshold requiring supporting documents for outward foreign currency fund transfers.

Comparison

PADG 13/2026 amends several provisions that had recently been amended through Board of Governors Member Regulation Number 8 of 2026 on the Third Amendment to Board of Governors Member Regulation Number 21/28/PADG/2019 on the Monitoring of Foreign Exchange Traffic Activities of Banks and Customers (“PADG 8/2026”). To better understand Bank Indonesia’s policy direction in strengthening the supervision and monitoring of foreign exchange traffic activities, the following comparison table is presented between PADG 13/2026, the previous amendments under PADG 8/2026, and Board of Governors Member Regulation Number 21/28/PADG/2019 on the Monitoring of Foreign Exchange Traffic Activities of Banks and Customers (“PADG 21/2019”).

Key Provisions

Obligation to Submit Supporting Documents

Pursuant to Article 27 paragraphs (1) and (2), any customer intending to conduct a Foreign Exchange Traffic (“LLD”) transaction in the form of an Outward Fund Transfer in foreign currency with a nominal value equivalent to above USD25,000.00 (twenty-five thousand United States dollars) is now required to submit Outward Fund Transfer Supporting Documents to the Bank.

This new nominal threshold requirement also applies to Natural Resource Exporters (“SDA Exporters”) conducting outward fund transfers through the Special Account (“Reksus”) for Natural Resource Export Proceeds Foreign Exchange.

Layered Verification Obligations of Banks

Pursuant to Article 27 paragraph (3), banks are prohibited from taking a passive approach and are required to verify and ensure the completeness of the supporting documents submitted by customers before approving the Fund Transfer Instruction. Banks may only execute outward transfer services once all documentary requirements have been declared complete and valid in accordance with the applicable regulations.

Exemptions from Supporting Document Requirements

The obligation to provide evidence of the underlying transaction is exempted and does not apply where the transaction satisfies one of the following criteria under Article 27 paragraph (5):

• Transactions conducted by a Bank institution solely for the Bank’s own operational purposes.
• Transactions intended solely for the transfer of funds between accounts owned by the same customer, provided that such accounts remain within Indonesia.

Types of Transaction Supporting Documents

Based on the Elucidation of Article 27 paragraph (1) concerning documents evidencing real economic activities, the supporting documents that may be attached include:

1.    Invoices from overseas sellers of goods and services;

2.    Loan agreements or other documents demonstrating an obligation to pay interest and/or loan principal;

3.    Agreements or other documents demonstrating obligations to pay royalties and other intellectual property rights;

4.    General Meeting of Shareholders documents demonstrating obligations to distribute dividends to foreign shareholders;

5.    Employment agreements or other employment-related documents demonstrating obligations to pay salaries and other remuneration;

6.    Documents relating to the liquidation of assets within Indonesia that constitute the rights of foreign parties; and/or

7.    Documents evidencing exemptions from or postponements of the obligation to use Rupiah for foreign exchange transactions conducted within Indonesia.

Use of a Special Statement Letter

Pursuant to Article 29 paragraph (2), where the supporting documents held by a customer are not included in the detailed list of technical reporting guidelines for Foreign Exchange Traffic under Annex II, the customer is required to supplement the deficiency by submitting a special statement letter. Such letter must be signed by the customer concerned, an individual holding a valid power of attorney, or an authorized officer empowered to act on behalf of a corporate customer.

Transitional Provisions

Pursuant to Article II, for Outward Fund Transfer transactions with values equivalent to above USD25,000.00 up to USD50,000.00 conducted during the period from 1 July to 31 July 2026, supporting documentation may temporarily consist solely of a written statement from the customer (containing the transfer date, amount, and purpose of the transfer).

Nevertheless, customers remain obligated to subsequently submit the complete formal Supporting Documents required under the regulation to the administering Bank no later than 31 October 2026.

Closing

PADG 13/2026 strengthens foreign exchange traffic supervision by lowering the threshold for the mandatory submission of supporting documents (underlying transactions) for foreign currency transfers from above USD50,000.00 to USD25,000.00. This amendment broadens the scope of transactions that must be supported by adequate documentation, thereby narrowing opportunities for unrecorded foreign exchange flows.

For both individual customers and businesses, this provision requires greater compliance in preparing and maintaining supporting transaction documents, including for medium-value transfers. On the other hand, banks are required to implement stricter verification and due diligence processes, meaning that transactions not supported by adequate documentation may be subject to delays or rejection.