May 22, 2026 | 07:05 pm
TEMPO.CO, Jakarta - Bank Indonesia (BI) recorded that the use of the local currency transaction (LCT) scheme reached US$22.61 billion by April 2026. This transaction value marks a 309-percent surge year-on-year compared to the US$7.33 billion recorded during the same period last year.According to Ruth Cussoy Intama, Director of Bank Indonesia's Financial Market Deepening Department, this spike reflects the growing adoption of domestic currencies in cross-border trade. "The volume has risen sharply, which has successfully driven currency diversification," Ruth said during a journalism training workshop in Makassar, South Sulawesi, on Friday, May 22, 2026.The LCT framework is a mechanism for settling bilateral transactions between Indonesian businesses and partner nations using their respective currencies via appointed cross-currency dealers (ACCD) or commercial banks. Through this scheme, enterprises can directly deploy domestic currency for trade transactions, bypassing the need to convert funds into US dollars first.However, she noted, the US dollar remains the dominant currency in global commerce. Nevertheless, relying on local currencies yields greater efficiency for transactions with countries that already maintain direct trade channels with Indonesia.Ruth clarified that the expanding use of local currencies does not imply that Indonesia is completely shunning the US dollar. Instead, optimizing these currency options serves to streamline and optimize trading activities. This framework also works to fortify the resilience of the national financial system."Using the dollar through third-party intermediaries triggers additional transaction costs," she explained. "So, the function of the LCT is to enhance local currency utilization and diversify risks."Read: JCI Opens Lower at 6,065.63, Volatility Expected to PersistClick here to get the latest news updates from Tempo on Google News
