Opening Bank Accounts in Indonesia – Many foreign nationals (WNA) living or working in Indonesia face challenges when it comes to managing their finances. Without a local bank account, daily transactions can become quite difficult. Paying for apartment rent, for example, often requires local bank transfers. Using foreign cards at EDC machines or ATMs comes with administration fees ranging from 3% to 5% per transaction. Sending money internationally can take days and comes with steep costs. As a result, many expatriates and foreign businesspeople are looking for ways to open accounts in local banks. But the question is, are they allowed to do so? The answer is yes, but there are certain requirements and regulations to follow. Let’s break it down.
As the number of expatriates in Indonesia grows, so does the demand for local bank accounts. Using foreign cards for payments often incurs additional fees, with currency conversion costs ranging from 2% to 5%. Cash withdrawals at ATMs can also come with a fixed fee or a certain percentage, and international bank transfers can take several days and be quite costly, depending on the method used.
Opening a Bank Account in Indonesia for Foreign Nationals
Can foreign nationals open local bank accounts in Indonesia? This is a common question, especially for those visiting the archipelago for the first time. The answer is yes, it’s legal! However, there are several requirements that need to be met.
In Indonesia, three types of bank accounts are typically used: checking, savings, and fixed deposits. Many Indonesian banks offer accounts in both local currency (Rupiah) and foreign currencies (usually USD), along with checking accounts, savings accounts, and credit/debit accounts.
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Several large banks in Indonesia, such as BCA, BRI, Mandiri, BNI, and CIMB Niaga, offer account opening services for foreign nationals. Some even offer special features for expatriates or foreign investors who want to store their funds in Indonesia. However, there are a few things to consider, including the types of accounts available and the documents required.
How to Open a Bank Account for Foreign Nationals
On September 15, 2015, the Financial Services Authority (OJK) issued a circular letter detailing certain relaxations in the requirements for opening accounts for foreign nationals. These regulatory changes are intended to attract foreign investment in Indonesia. Additionally, they are part of efforts to stabilize the rupiah and reduce the volatility of the local currency against the dollar.
OJK Circular Letter (S-246/S.01/2015) clarified whether foreign nationals can open accounts in Indonesia. The simplification of requirements includes the following:
- Tourist Accounts with Limited Balance between $2,000 – $50,000:
- The Customer Due Diligence (CDD) process requires only a passport as identification.
- The initial deposit is at least $2,000, with a maximum balance of $50,000.
- Balances under $10,000 may incur higher charges.
- Foreign National Accounts with Unlimited Balance:
- CDD requires a passport and one additional document (such as a reference letter from a bank in the home country, a local residence certificate, spouse’s ID, photocopy of a housing contract, or credit/debit card).
- Balances exceed $50,000.
- Foreign National Accounts with Special High Balances:
- CDD requires a passport and additional documents (similar to the second type).
- Balances exceed $1,000,000.
- Deposit interest taxes are lower than the general tax rate and are applied progressively (larger balances, lower taxes).
- This type of account is prioritized for opening by banks that meet risk management and banking prudence standards.
OJK has implemented a selection process for potential account holders, including account opening forms and customer identification through face-to-face meetings and facial photos to comply with Know Your Customer (KYC) standards.
Moreover, OJK conducts annual oversight, as mandated by law, ensuring that account opening procedures are monitored at least once a year, in line with associated risks.
Benefits of Opening a Bank Account in Indonesia for Foreign Nationals
Some might wonder, “Why open a bank account in Indonesia when I already have one in my home country?” The answer is simple: convenience.
With a local bank account, foreign nationals can transact easily in rupiah, avoiding high currency conversion fees, and access a variety of financial services in Indonesia, including debit cards, mobile banking, and even credit facilities.
For those working or doing business in Indonesia, local bank accounts also make receiving salaries, paying taxes, and handling other financial transactions much simpler.
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