President Prabowo Subianto officially launched Indonesia’s first bullion bank on Wednesday, February 26, 2025, at The Gade Tower, Central Jakarta, at 2:00 PM Western Indonesian Time.
According to Yusuf Permana, Deputy for Protocol, Press, and Media at the Presidential Secretariat, the establishment of a bullion bank is a strategic move to strengthen the national gold industry ecosystem and support downstream initiatives under the government’s Astacita program.
“This afternoon, President Prabowo is scheduled to inaugurate the bullion bank service, which is the first of its kind in Indonesia,” Yusuf stated, as reported by antaranews.com.
Yusuf also mentioned that the inauguration ceremony is open to the press, and Presidential Palace journalists are welcome to cover the event.
Background of the Bullion Bank Initiative
The announcement regarding the bullion bank was previously made by President Prabowo while unveiling the Foreign Exchange Proceeds (DHE) policy for natural resources and other economic policies at the Merdeka Palace in Jakarta on Monday, February 17.
Prabowo highlighted the need for a dedicated gold bank in Indonesia, as domestically mined gold has been exported without proper local storage facilities.
“We will establish a bullion bank because, until now, we haven’t had a dedicated institution for managing gold,” Prabowo stated at the Merdeka Palace, Jakarta, on February 26, 2025, as cited by kompas.com.
Economic Potential of the Bullion Bank
According to the Financial Services Authority (OJK), the establishment of a bullion bank could generate up to USD 3 billion in added value for Indonesia’s gold industry. The business prospects for bullion banking are expected to improve significantly.
OJK research suggests that bullion banking can maximize the value of Indonesia’s gold resources, including both mined gold and privately owned gold reserves.
“A bullion bank has the potential to increase retail gold consumption, thereby stimulating the entire gold industry and business ecosystem, with an estimated added value of USD 1,8-3 billion,” stated Dian Ediana Rae, Executive Head of Banking Supervision at OJK.
Regulations and Licensing for Bullion Banks
Previously, OJK issued Regulation No. 17 of 2024 concerning the Operation of Bullion Business Activities, which serves as the legal framework for financial institutions engaging in the gold sector.
On January 6, 2025, OJK granted PT Pegadaian the license to operate Indonesia’s first bullion bank. A month later, Bank Syariah Indonesia (BSI) also received authorization to function as a bullion bank.
Both Pegadaian and Bank Syariah Indonesia are now authorized to offer gold banking services, including gold deposits, gold-backed working capital loans, corporate gold custody, and gold trading services.
Prabowo emphasized that the bullion bank will significantly improve Indonesia’s gold management. Currently, much of the country’s gold is mined and exported without domestic retention.
“A substantial portion of our gold has been mined and flows overseas. Now, we aim to establish a dedicated gold bank in Indonesia,” Prabowo stated at the Merdeka Palace on February 17, as reported by cnnindonesia.com.
Source: antaranews.com, kompas.com, cnnindonesia.com
Photo Credit: Pixabay via pexels.com
