Bank Indonesia (BI) and Bank Negara Malaysia (BNM) agreed to strengthen the transaction settlement framework using Rupiah-Ringgit (Local Currency Settlement/LCS),  implemented since January 2, 2018.

The LCS cooperation framework strengthened. It expanded from originally only covered trade transactions to include underlying LCS transactions by adding direct investment and income transfers (including remittances), BI press release said on Monday.

In addition, the strengthening of LCS cooperation between BI and BNM also includes easing foreign exchange transaction rules, among others, related to the expansion of hedging instruments and increasing the threshold value of transactions without underlying documents up to US$200,000 per transaction.

The strengthening of the LCS framework in Rupiah-Ringgit will take effect on August 2, 2021.

The strengthening of the framework is in line with the Memorandum of Understanding signed by BI and BNM on D