Regulation No. 8/26/PBI/2006 Concerning Rural Banks


(enacted in 2006)

Regulation No. 8/26/PBI/2006 Concerning Rural Banks, issued by Bank Indonesia, promotes the strengthening of rural banks (RBs) in Indonesia.

This regulation stipulates that RBs, which are part of the national banking system, need strengthening so that they become a strong, productive and competitive industry while improving services to micro- and small-scale businesses.

The regulation explains the terms that it uses and then sets out provisions for:

  • The legal incorporation of an RB;
  • The establishment of an RB and its business activities, its ownership and the minimum capital needed for its establishment;
  • The submission of the application for the ‘approval in principle’, as well as the approval or rejection of this application;
  • The application for the operating license, its approval or rejection and the date from which the RB has to operate once it obtains the license;
  • The incorporation of the name of the national bank in front of the name of the RB
  • Ownership and changes in rural bank capital;
  • The board of directors, the board of commissioners and executive officers;
  • The opening of RB offices, the opening of cash units, outdoor cash services;
  • Changing the office address, name and legal incorporation;
  • The closure of office;
  • The conversion of business;
  • Punitive measures in case of the violation of report obligation;
  • Various sanctions;
  • Transitional provisions; and
  • Concluding provisions.

DISCLAIMER: The attached document is an unofficial translation of Regulation No. 8/26/PBI/2006 Concerning Rural Banks. An official translation is unavailable.