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OJK Issues Guidance For Gold Bank Business Activities

The Financial Services Authority (OJK) has issued Financial Services Authority Regulation (POJK) Number 17 of 2024 concerning the Conduct of Bullion Business Activities. This regulation aims to provide guidelines for Financial Service Institutions (LJK) in managing bullion business activities or gold banking.

Agusman, the Head of the Executive Supervisory Board for Financing Institutions, Venture Capital Companies, Microfinance Institutions, and Other Financial Service Institutions (PVML) at OJK, stated that bullion business activities encompass operations related to gold, including gold savings, gold financing, gold trading, gold custody, and other activities conducted by financial service institutions.

"This POJK has been established to offer guidance to Financial Service Institutions (LJK) regarding the conduct of bullion business activities, covering aspects such as the scope of bullion business activities, requirements for LJK conducting bullion business, licensing mechanisms for bullion business activities, phased implementation of bullion business activities, and the application of prudential principles," Agusman remarked in a statement on Thursday, November 14, 2024. 

Furthermore, this POJK regulates the implementation of good corporate governance and risk management for LJK engaged in bullion business activities, the application of anti-money laundering programs, prevention of terrorism financing, and prevention of the proliferation of weapons of mass destruction, as well as the implementation of anti-fraud strategies and consumer protection, along with reporting systems.

Agusman expresses hope that the issuance of this Financial Services Authority Regulation (POJK) will serve as a significant effort by the OJK to encourage financial service institutions (LJK) to bridge the gap between supply and demand for gold, including the monetization of idle gold within the community. It is important to note that this POJK is derived from Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector (P2SK), which mandates financial service institutions to conduct Bullion Business Activities. These activities pertain to gold in the form of gold savings, gold financing, gold trading, gold custody, and other related activities undertaken by LJK.

Furthermore, POJK Number 17 of 2024 regarding the Implementation of Bullion Business Activities outlines the scope of bullion business activities, the requirements for LJK conducting these activities, and the licensing mechanisms for bullion business operations.

Additionally, it details the phased implementation of bullion business activities, the application of prudential principles, the enforcement of good corporate governance and risk management for LJK engaged in bullion activities, the implementation of anti-money laundering programs, the prevention of terrorism financing, and the prevention of the proliferation of weapons of mass destruction financing, as well as the application of anti-fraud strategies and consumer protection measures, along with reporting requirements.

Tag: Financial Service Institutions Gold Bank Business OJK