Currently, the Government and the DPR are trying for the third time to amend Law no. 7/1992 concerning Banking. Several factors have driven this change, including, 1) fundamental changes in the banking industry and other financial services sectors following the 2008 global crisis, particularly in terms of strengthening capital, governance, risk management, and the role of the government. 2) the growing need for development financing, economic equity, easy access for the community, 3) the birth of various laws and regulations that significantly affect the banking industry such as Law No. 8 of 2010 concerning Prevention and Eradication of the Crime of Money Laundering, Law no. 21 of 2008 concerning Islamic Banking, Law no. 11 of 2008 concerning Information and Electronic Transactions, Law no. 24 of 2004 concerning the Deposit Insurance Corporation, Law no. 14 of 2004 concerning Openness of Public Information, and Law no. 8 of 1999 concerning Consumer Protection.
The Draft Banking Bill has been re-entered the 2015-2019 National Legislation Program and continues to be discussed by Commission XI of the DPR after previously being prepared by the Working Committee of Commission XI of Commission XI of the House of Representatives for the 2019-2014 period. The DPR continued to seek input and refinement of the draft Banking Bill through consultations and working visits from the DPR to a number of universities and other stakeholders in 2015.2
A number of parties welcomed this Banking Bill with quite diverse views, ranging from the desire to agree on a national financial architecture, a banking blueprint to the debate over the portion of foreign ownership of banks.3 Debate is also inevitable regarding the authority of banking supervision after the birth of the Financial Services Authority.
So far, there are a number of issues that have been raised and changed in this Banking Bill, and are generally dominated by issues related to the pragmentation of regulatory and supervisory powers involving the Financial Services Authority, ownership, conglomeration, regulation regarding foreign banks, the role of banks in maintaining financial stability and development financing. However, the issues raised by civil society such as the environment, human rights, corruption, taxes, consumers and others seem to have not caught the attention of the drafters of this bill.
The white paper contains critical notes on the final draft of the Banking Bill (as of 2014)4 and is a civil society proposal to improve the Banking Bill and reform the banking legal system which is expected to be more respectful of social aspects, human rights, the environment, anti-corruption, inclusive and protect consumer interests.
