Singapore and Indonesia Enable Direct Settlement in Local Currencies

Singapore Indonesia local currency settlement is now operational, allowing trade, direct investment and cross-border payments between the two markets to be conducted directly in Singapore dollars and Indonesian rupiah.

The framework, launched by the Monetary Authority of Singapore and Bank Indonesia, is designed to reduce foreign-exchange risks and transaction costs while encouraging broader use of regional currencies.

Appointed cross-currency dealers will facilitate settlement and provide direct quotations between the Singapore dollar and rupiah.

DBS, OCBC and UOB have been selected as participating banks in Singapore, while Indonesia’s participants include Bank Mandiri, Bank Central Asia and Bank Negara Indonesia.

The banks expect the framework to generate demand for currency conversion, liquidity-management and hedging services from businesses, investors and family offices with operations or investments spanning both markets.

The initiative supports wider ASEAN efforts to reduce reliance on third currencies for regional transactions.