BI should stop remunerating the statutory reserves

By Harry Pattikawa Rotterdam, the Netherlands A senior credit analyst at a Dutch bank. The views expressed are his own.
OPINION

Bank Indonesia (BI) will gradually increase the statutory Reserves Requirement Ratio (RRR) to 6.5 percent in September. The critical point to note here is that BI provides remuneration to banks in the form of 1.5 percent interest on the RRR. The RRR...

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