Bank Indonesia has canceled the launch of a new transaction tracking system, Payment ID, which was initially planned for August 17, 2025.

The system is still in the trial phase and remains in a sandbox environment, according to Dicky Kartikoyono, head of BI’s payment system policy department.

Payment ID is a nine-character alphanumeric code intended to integrate with Indonesia’s national identity number (NIK) and link various financial transactions, including those from bank accounts and digital wallets.

There is no official timeline for when Payment ID will be implemented, but it may be used in a non-cash social aid program in Banyuwangi, East Java, starting September 2025, subject to government approval.

The first phase of Payment ID’s broader rollout is targeted for 2027, with further expansion in 2029.

BI is working with stakeholders to address potential privacy concerns and ensure data protection in line with Indonesia’s Personal Data Protection Law.

Payment ID will supplement, not replace, the Financial Information Service System (SLIK) operated by the Financial Services Authority.

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🔗 Source: Kompas.com

🧠 Food for thought

1️⃣ Complex financial tracking systems face longer development cycles than simpler payment innovations

Payment ID’s postponement from August 2025 to a 2029 full rollout highlights the challenges of implementing comprehensive financial monitoring systems.

This contrasts with Indonesia’s successful QRIS rollout, which achieved 54.1 million users and 34.7 million merchants by October 2024 1.

QRIS transactions surged from 124 million in 2020 to a projected 6.24 billion by 2024, demonstrating how focused, single-purpose payment systems can achieve rapid adoption 1.

The key difference lies in scope and complexity. QRIS simplified existing payment processes, while Payment ID attempts to create a unified financial identity system linked to national ID numbers.

Payment ID requires extensive regulatory frameworks under Indonesia’s Personal Data Protection Law and must address privacy concerns that simpler payment systems avoid 2.

The extended timeline reflects the technical and regulatory challenges of building systems that aggregate data across multiple financial institutions while maintaining user consent and privacy protections.

2️⃣ Financial identity systems target Indonesia’s MSME credit access gap

Payment ID addresses a specific structural problem in Indonesia’s economy where many small businesses cannot access formal banking due to lack of credit history.

Bank Indonesia officials explicitly cited this challenge, noting that “UMKM kita sekarang banyak yang enggak bisa akses ke perbankan karena perbankan enggak tahu siapa mereka” (many of our MSMEs cannot access banking because banks don’t know who they are).

The system aims to create comprehensive financial profiles that could enable banks to assess creditworthiness for previously “invisible” small businesses.

This approach differs from traditional credit scoring by potentially capturing informal economy transactions through digital payment data, giving banks visibility into previously undocumented cash flows.

The pilot program’s focus on social assistance distribution in Banyuwangi serves as a testing ground for verifying financial identities, which could later support MSME credit assessments.

Recent Bank Indonesia developments

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