Regulatory AlertsUse of Foreign Workers and Knowledge Transfer Programs by Commercial Banks
The Financial Services Authority (OJK) issued Regulation No. 1 of 2026 to replace outdated rules on foreign worker utilization in the banking sector, aiming to enhance industry resilience and national economic development. The regulation establishes principles for employing foreign workers, including permissible roles, a maximum five-year tenure, and specific obligations for banks and foreign representative offices. It also mandates a structured process for planning, approval, reporting, and knowledge transfer programs to develop the competency of national human resources.
Regulation of the Financial Services Authority Number 1 of 2026 concerning the Use of Foreign Workers and Knowledge Transfer Programs by Commercial Banks
Abstract: In order to enhance the resilience and competitiveness of the banking industry and national economic development in strategic sectors, as well as to support knowledge transfer programs and the development of human resource competencies in the banking sector, it is necessary to establish adaptive and balanced regulations regarding the use of foreign workers. In order to develop the capacity of national banking human resources, it is necessary to increase the implementation of assignments for bank employees who are Indonesian workers to work abroad in the context of employee exchange or intracorporate transferees. The Financial Services Authority Regulation Number 37/POJK.03/2017 concerning the Utilization of Foreign Workers and Knowledge Transfer in the Banking Sector is no longer in line with national labor policies and the needs of the banking industry, and therefore needs to be replaced. Based on the considerations mentioned above, it is necessary to establish a Financial Services Authority Regulation concerning the Use of Foreign Workers and Knowledge Transfer Programs by Commercial Banks.
The legal basis for this Financial Services Authority Regulation is: Law Number 7 of 1992 as amended several times, most recently with Law Number 4 of 2023; Law Number 21 of 2008 as amended several times, most recently with Law Number 4 of 2023; and Law Number 21 of 2011 as amended with Law Number 4 of 2023.
This Financial Services Authority Regulation regulates the Principles of using Foreign Workers (TKA), which consist of positions and fields of work that may employ Foreign Workers, the duration of Foreign Worker usage, which is at most 5 (five) years, including requirements and obligations for Banks or Representative Offices of Banks located outside the country (KPBLN) in the use of Foreign Workers; and the procedures for using Foreign Workers, namely planning the use of Foreign Workers, requesting approval, reporting the appointment of Foreign Workers, obligations to implement knowledge transfer programs, submission of realization reports, extension of the duration of Foreign Worker usage, and termination of Foreign Workers.
Note: This Financial Services Authority Regulation takes effect on the date of its promulgation. This Financial Services Authority Regulation was promulgated on February 23, 2026, and established on February 6, 2026. At the time this Financial Services Authority Regulation takes effect, the Financial Services Authority Regulation Number 37/POJK.03/2017 concerning the Utilization of Foreign Workers and Knowledge Transfer Programs in the Banking Sector is revoked and declared invalid.