Burden Sharing Let Bank Indonesia Buy Rp217 Trillion in Government Bonds Directly. The Finance Minister Says Not Again Soon
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7 min read
In September 2025, Bank Indonesia bought Rp217.1 trillion of government bonds directly from the Ministry of Finance, not through the regular weekly auction every SBN investor watches. It also agreed to absorb part of the interest cost on those bonds itself. A little over a month later, Indonesia's own finance minister stood up in front of 100 economists and said the country doesn't need to do this again.
The arrangement is called burden sharing, and it is one of the more unusual tools a central bank keeps in its back pocket. Here's what it actually is, when it gets used, and why the government just walked away from it again.
Start with the basic building block: SBN (Surat Berharga Negara) is Indonesia's government bond, issued by the Ministry of Finance to fund the state budget. Normally, SBN is sold through auctions to banks, pension funds, mutual funds and foreign investors, the same way most countries sell government debt. Bank Indonesia can also buy SBN, but normally only in the secondary market, meaning it buys bonds that already exist from someone who bought them first. That kind of purchase doesn't hand the government fresh money.
Burden sharing is different. Under burden sharing, Bank Indonesia buys SBN directly from the government in the primary market, the same moment the bond is first issued. That money goes straight into state coffers. On top of that, Bank Indonesia agrees to shoulder part of the interest the government would otherwise owe on those bonds, which is the "sharing" half of the name. The whole thing gets formalized in a joint decree the two institutions sign together, called an SKB (Surat Keputusan Bersama, literally "joint decision letter").
Bank Indonesia can't just decide to fund the government whenever it wants to. Since 2023, Article 36A of Law No. 4/2023 (the Financial Sector Development and Strengthening Law, known as UU P2SK) sets the legal gate: Bank Indonesia may only buy long-term SBN in the primary market to handle a crisis, and only after the President has formally declared a crisis status on the recommendation of the Financial System Stability Committee (KSSK), the body that also includes the Finance Ministry, the OJK financial regulator and the deposit insurer LPS.
That is a very different bar from SRBI, Bank Indonesia's own rupiah security, which it auctions twice a week without needing anyone's permission. SRBI pulls rupiah liquidity out of the market. Burden sharing pushes new money in, directly into the state budget, and it only happens when the law says a crisis is underway.
The first and largest use of burden sharing came out of the COVID-19 shock. Bank Indonesia and the Ministry of Finance signed three separate SKBs between 2020 and 2022:
| Decree | Period | How the interest was set | BI's own share of the cost |
|---|---|---|---|
| SKB I | 2020 | Market rate | Government paid the interest |
| SKB II | 2020 | Fixed at a 7% yield | Bank Indonesia covered all of it, Rp397.56 trillion worth |
| SKB III | 2021-2022 | Bank Indonesia's own funding cost | Bank Indonesia covered Rp439 trillion more |
Add it up and, according to Ministry of Finance figures, Bank Indonesia's total contribution through this scheme from 2020 to 2022 came to roughly Rp1,104.85 trillion, close to 7% of Indonesia's GDP at the time. Then Finance Minister Sri Mulyani Indrawati later said the arrangement saved the state budget around Rp30 trillion in interest costs it would otherwise have paid on its own. It was, by design, a pandemic-era measure. Bank Indonesia's own leadership said publicly in 2022 that it did not expect to repeat it the following year.
Burden sharing came back in September 2025, in a much narrower form. Bank Indonesia and the Ministry of Finance signed a new SKB to help fund two of President Prabowo Subianto's priority programs: the 3 Million Homes housing initiative and the Koperasi Desa/Kelurahan Merah Putih village cooperative program. By 16 September 2025, Bank Indonesia had bought Rp217.1 trillion of SBN under the arrangement, up Rp31 trillion from the month before.
The interest split this time was a genuine 50:50 share rather than the pandemic's tiered scheme: Bank Indonesia and the government each absorbed roughly 2.9 percentage points of the interest cost on bonds funding the housing program, and roughly 2.15 percentage points each on bonds funding the village cooperative program.
On 28 October 2025, at a gathering of 100 Indonesian economists, Finance Minister Purbaya Yudhi Sadewa said the burden sharing scheme was "no longer relevant" to Indonesia's current situation, arguing that mixing fiscal and monetary policy this way risks blurring a line that should stay clearly separated. He repeated the same position in February 2026 at the Indonesia Economic Summit, again framing it as a matter of protecting Bank Indonesia's independence.
By September 2026, Purbaya had a number to back that stance up: about 87.5% of Indonesia's SBN is now held by domestic investors, which he pointed to as evidence that government financing no longer depends on outside help. Indonesia's debt-to-GDP ratio stood at roughly 40.5% at the end of 2025, well within the 60% ceiling set by law. From the finance minister's chair, the case for reaching for an emergency tool again is hard to make right now.
Here's where it gets easy to mix things up. Even without any active burden sharing arrangement, Bank Indonesia's own SBN holdings, bought the ordinary way through its regular secondary-market operations, have kept climbing. As of 27 August 2026, Bank Indonesia held roughly Rp1,899 trillion of SBN, about 27.23% of all tradable rupiah-denominated government bonds outstanding, the single largest holder category, ahead of the entire domestic banking sector at around 16.41%.
If burden sharing returns a third time, it won't be quiet. It requires a declared crisis status and a new, publicly signed SKB, both of which are events, not gradual trends. What you can watch in the meantime is the ordinary story: Bank Indonesia's own share of the SBN market, the BI rate, and the rupiah, all of which move together and all of which show up on NetWort's Macro Context page. If you want to see how the government's regular bond issuance affects the yields you'd actually be offered as an investor, that mechanic is covered separately in NetWort's piece on how rising SBN issuance moves yields.