04.09.202503:23:41UTC+00BI to Raise Interest Paid on Government Deposits Under Burden Sharing Deal

Indonesia's central bank has finalized a "burden-sharing" agreement with the government. This arrangement is designed to bolster public funding initiatives by increasing the interest rates paid on government deposits. According to Bank Indonesia (BI) spokesperson Ramdan Denny Prakoso, this strategy aims to assist the government in raising capital via the bond market for significant projects, such as affordable housing and the formation of cooperatives in rural areas, as reported by Reuters. This agreement involves dividing the financial burden evenly for bonds issued to support these programs, after accounting for any interest income the government receives from its deposits with domestic financial entities. Additionally, Bank Indonesia has acquired IDR 200 trillion (approximately USD 12.3 billion) in government bonds on the secondary market, inclusive of IDR 150 trillion via a debt swap with the government.