2022 State Budget and Fiscal Incentives Presentation
Principles of Domestic Non Deliverable Forward (DNDF) Transaction
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Purposes
To support the effort of
stabilizing the Rupiah exchange
rate through the additional of
alternative hedging instruments
To support the development and
deepening of the domestic
financial market
To increase the confidence of
exporters, importers, and
investors in conducting
economic and investment
activities through the flexibility of
hedging transactions against
Rupiah currency risk
General Provisions
✰ Domestic Non-Deliverable Forward Transaction (DNDF Transaction)
Plain vanilla derivative transaction of foreign exchange against rupiah in the form
of forward transaction with fixing mechanism in the domestic market
Forward Transactions
Forward Transactions are sell/purchase foreign currencies against rupiah
whereas the delivery of funds shall be performed in more than 2 days after the
transaction date
Fixing Mechanism
Transaction settlement mechanism without full movement of funds by calculating
the difference between rate on the transaction date and reference rate in JISDOR
on a specified future time agreed in the contract (fixing date)
Other Definitions
The definition of derivative transaction of foreign exchange against rupiah,
Forward Transaction, Spot Transaction, Customers, Foreign Party is referring to
Bank Indonesia regulations regarding foreign exchange transaction against
rupiah
Source: Bank Indonesia
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