Indonesia is one of the world’s largest gold producers, yet much of its gold is exported without proper domestic storage. To change this, the government is preparing to launch the first bullion bank in Indonesia. President Prabowo Subianto is set to officiate its inauguration on Wednesday (February 26, 2025).
At a press conference at Merdeka Palace in Jakarta on Monday (February 17), Prabowo highlighted the significance of this milestone. “This will be Indonesia’s first bullion bank,” he said. The Financial Services Authority (OJK) expects this initiative to strengthen the country’s gold industry and improve financial stability.
A bullion bank allows customers to save their wealth in gold rather than traditional currency. This concept is regulated under Financial Services Authority Regulation (POJK) No. 17 of 2024 on Bullion Business Activities, which took effect on October 18, 2024. It is part of Law No. 4 of 2023 on the Development and Strengthening of the Financial Sector (UU P2SK).
According to Kompas.com, bullion banking can enhance the value of Indonesia’s gold resources, covering both mined gold and privately owned reserves.
OJK’s Chief Executive of Banking Supervision, Dian Ediana Rae, sees the first bullion bank in Indonesia as beneficial not just for the government but also for businesses, financial institutions, and the public. The OJK estimates that bullion banking could increase retail gold consumption and contribute Rp30-50 trillion in added value to the economy.
Economist Josua Pardede of PermataBank also sees enormous potential. Speaking to Antara, he explained that if properly managed with the right strategies and policies, bullion banking could become a key pillar in Indonesia’s economic transformation. “It can strengthen economic resilience and maximize Indonesia’s domestic gold potential,” he said.
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Indonesia is among the world’s top 10 gold producers, contributing 4.15% to global gold production. Additionally, an estimated 1,800 tons of gold remain unmobilized within society, alongside 7.6 tons of national gold reserves. These figures reflect significant opportunities for bullion banking to channel domestic gold into the economy.
One major advantage of this system is its ability to increase liquidity and attract investment. Josua believes bullion banking can serve as a stable safe-haven asset, offering protection against inflation while drawing investors into gold-backed financial instruments.
Another key benefit is reducing Indonesia’s reliance on gold imports. By monetizing domestic gold, the country can cut down import dependence, indirectly strengthening its trade balance.
Beyond these economic gains, bullion banking is expected to contribute to financial inclusion and deepen the financial sector. With all these factors in play, Indonesia’s first bullion bank is poised to reshape the gold industry while strengthening the nation’s economic foundation.
