Jakarta (VNA) – The Indonesian Deposit Insurance Corporation (IDIC) has decided not to collect the guarantee premium from banks in the second half of 2020 to help the industry manage its cash flow in the midst of COVID-19.

The decision was made to give room for bank moves, IDIC chairman Halim Alamsyah told reporters on May 11 after a coordination meeting of the Financial System Stability Committee (KSSK).

With this easing policy, banks will not be fined for late paid premiums for the next six months, he said.

The Financial Services Authority (OJK) has earlier issued a regulation, urging banks to restructure debtors affected by the pandemic. The saving interest rate will be likely to drop significantly from currently 5.74 percent, disturbing the bank’s liquidity.

At the end of the first quarter of this year, the Rupiah deposits rate fell by an average of 28 basis points to 5.50 percent. However, savings grew 10.2 percent year on year, Alamsyah said, showing public confidence is still high in entrusting their funds to be deposited in national banks.

To help bank’ liquidity, Indonesia’s central bank has poured 503.8 trillion Rupiah (33.58 billion USD) through a quantitative easing policy. The regulators also prepared anchor bank and a number of schemes to overcome the liquidity problems in the Indonesian financial industry amid the pandemic./.