Arnoldus Kristianus, Jakarta – Indonesia and Singapore have officially operationalized their bilateral local currency transaction framework, the central banks announced Monday, marking progress in ASEAN's move away from the American dollar.

A statement by the Monetary Authority of Singapore (MAS) and its Jakarta counterpart Bank Indonesia wrote that the framework followed a 2022 memorandum of understanding. A few months ago, the central banks also struck an agreement on the operational guidelines.

"Key features of the framework include the promotion of direct quotations between the Indonesian rupiah and Singapore dollar, as well as implementation of relevant rules and regulations to enhance the usage of local currencies," the statement reads.

They expect such moves to offer businesses greater flexibility in their transactions, while reducing their exchange rate risks and costs.

They have also picked as many as 9 Indonesian banks to facilitate the local currency payments: namely BCA, CIMB Niaga, DBS, Maybank, BNI, OCBC NISP, Bank Jatim, and UOB Indonesia.

The list of the 3 eligible Singaporean banks is as follows: DBS Bank Ltd, Oversea-Chinese Banking Corporation Limited, and United Overseas Bank Limited.

Singapore is among Indonesia's key trading partners. ASEAN has been pushing for greater use of their respective currencies in intraregional trade.

Government data showed Indonesia-Singapore trade amounted to $16.9 billion in the first half of 2026, with Jakarta recording a deficit of almost $4.4 billion.

The Indonesian rupiah has been free-falling against the American dollar in recent months, even breaking the Rp 18,000 threshold.

Source: https://jakartaglobe.id/business/bye-us-dollar-indonesia-singapore-use-local-currencies-in-trad