CARDS & PAYMENTS | Staff Reporter, Indonesia

Indonesia joins Vietnam in slamming non-compliant Chinese e-wallets

E-wallets need to first tie up with local banks before operating.

Bank Indonesia (BI) reiterated its stance that foreign consumer payment applications like Chinese e-wallets used by tourists are not approved for local use.

Chinese e-wallets like Alipay and WeChat Pay are wildly popular amongst visitors in tourist destinations like Bali.

Also read: China's payment giants try to conquer Asia's banking scene

However, the National Payment Gateway requires any foreign player handling retail transactions to first forge partnerships with local switching companies and major Indonesian banks.

“So far we have found two cases. [The foreign payment apps] have cooperated with local switching companies, but they are neither connected to nor are cooperating with Book 4 [major] banks,” BI payment system policy executive director Onny Widjanarko told local media.

He also stressed that all transactions in the country were required to use the rupiah.

Onny added that the central bank will halt any transactions channeled through foreign payment apps that do not meet the required criteria. “Any payment system should be adjusted to existing regulations,” he said.

Vietnam earlier raised concern about the surge in Chinese e-wallets used in tourist hotspots like Da Nang and Ha Long Bay.

Vietnamese banks are not officially connected to the WeChat service, making it illegal in the country. As the transactions on the platform are not controlled by any local lender, the country may face tax losses.

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