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    Bank Indonesia Regulates Unlicensed Money Changer Organizations in West Java


    BANDUNG - Non-Bank Currency Exchange Business Activity (KUPVA) is a business activity that includes exchange activities done by buying and selling Foreign Banknotes (UKA) and purchasing traveler's checks. KUPVA BB is an alternative besides banks to exchange foreign exchange.

    Bank Indonesia has provided a transitional period until April 7th, 2017 to parties who have been conducting business activities with unlicensed foreign cash without permission (KUPVA-BB Unlicensed) to immediately submit licenses to Bank Indonesia.

    After the end of transition period, in accordance with Article 38 paragraph 3 of PBI No.18/20/PBI 2016, it is stipulated that Bank Indonesia may submit a written warning and/or recommend to the competent authority to stop business activities and/or revoke business licenses granted by the authorities referred.

    In implementing this article, BI cooperates with Indonesian National Police as stipulated in a Memorandum of Understanding of September 1, 2014 concerning Cooperation in the Context of Implementation of Bank Indonesia's Tasks and Authority with the Indonesian National Police, which is followed up by the Principles of Understanding (PPK) between West Java KPw BI and West Java Regional Police on April 30, 2015 concerning Procedures for Implementing Cooperation in the Context of Supporting the Duties and Authorities of West Java Bank Indonesia Representative Offices and West Java Regional Police, that is agreeing on procedures for handling alleged criminal acts in the payment system and Business Activities Currency Exchange (KUPVA BB).

    Exchange activities in West Java are generally carried out by Licensed KUPVA Organizers. However, it is reasonable to expect that there are still unlicensed BB KUPVA. Based on KPw BI Data of West Java up to July 2019, the number of licensed KUPVA-BB in West Java Province is 37 operators. Meanwhile, the number of unlicensed KUPVA-BB based on market intelligence is 5 organizers.

    Unlicensed BB KUPVA is carried out in the Cities and Sukabumi Districts. Unlicensed KUPVA-BB is usually carried out by Gold Stores, Groceries which are side business activities (not for UKA buying/selling activities), and there are specific illegal Foreign Exchange Traders. This is to help consumers/ the community who will sell UKA especially from Indonesian Workers (TKI).

    In general, unlicensed KUPVA-BB has not known any regulations regarding KUPVA-BB regulations. For information on the supervision area of West Java BI KPw, BI KPw Tasikmalaya, BI KPw Cirebon, exclude Depok, Karawang, Bekasi, Bogor.

    "KPw BI West Java Province in collaboration with the Police, has conducted data collection, education/socialization, and the first handling of KUPVA-BB that has not been licensed in cities and districts in West Java KPwBI supervision area. The education/socialization aims to explain the provisions and BB KUPVA licensing obligations, "said Head of West Java BI KPw Dony P Joewono.

    In addition, West Java Provincial KPw also encouraged and assisted unlicensed BB KUPVA organizers to immediately apply for permission as licensed BB KUPVA to Bank Indonesia: it will not be charged any fees. Some of the problems faced by BB unlicensed KUPVA organizers especially for small money changers and street vendors are legal obligations of Limited Liability Companies (PT), capital requirements, formal education for management (Directors and Commissioners).

    Until now, from five unlicensed BB KUPVA, there are two unlicensed BB KUPVAs are in the licensing process, and the others are still conducting licensing consultations.

    So far, the parties in control are cooperative; thus, the controling activities can run well and conducive. There are business actors who display currency exchange attributes found in the field besides violation activities of changing foreign currencies without permission.

    To five perpetrators of foreign exchange activities without permission that got control measures, the enforcement stickers have been affixed until the perpetrator submits a business license to Bank Indonesia. Bank Indonesia has subsequently conducted monitoring on July 11, 2019 to ensure the fulfillment of parties' commitments with the attached stickers on all business areas / locations. Meanwhile, for parties that is proven to falsify the permit mark, they will definitely be processed according to the provisions applicable. To those who have been attached enforcement stickers at the business location, it is strictly prohibited to damage, remove or move the stickers with a criminal threat of Article 232 of the Indonesian Criminal Code.

    The community is advised to always use KUPVA that has received permission from Bank Indonesia, and to inform the nearest Bank Indonesia office or through Bank Indonesia call center 131 when finding parties that are suspected to conduct foreign exchange activities without Bank Indonesia's permission. Jo


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