Bank Indonesia cut the average reserve requirement ratio, known as GWM, for conventional banks from 9 percent to 8 percent effective 1 November 2026, and to 7 percent effective 1 December 2026. For sharia banks, the ratio falls from 7.5 percent to 6.5 percent on 1 November and to 5.5 percent on 1 December.
The central bank also reduced its Macroprudential Liquidity Incentive, known as KLM, from 6 percent to 5 percent, effective 1 December 2026. It kept the BI Rate at 5.75 percent.
Liquidity and credit
Governor Destry Damayanti said the reserve requirement reduction of up to 2 percent would add liquidity of roughly Rp190-odd trillion, by the central bank’s calculation. The move is intended to strengthen banking liquidity and encourage lending to the real sector.
The easing comes while bank credit growth remains strong. Credit rose 13.26 percent year on year in September 2026, with investment credit up 23.2 percent and working capital credit up 11.89 percent. Consumption credit grew 4.86 percent.
Policy backdrop
The measures were announced after the Board of Governors meeting held on 20 and 21 October 2026. Bank Indonesia said they form part of its policy mix amid global uncertainty and pressure on the rupiah.
Third-party funds grew 8.22 percent year on year, while undisbursed loans stood at Rp2,562 trillion, or 21.7 percent of the available credit ceiling. Bank Indonesia projects bank credit growth of 8 to 12 percent for 2026.
Related: Bank Indonesia holds BI Rate at 5.75%, raises deposit rate to 5% · ADB sees Bank Indonesia holding rate at 5.75% in 2026
Source: Bank Indonesia
