Digital System Supports Transparency in Social Assistance Distribution
JAKARTA – The government continues to strengthen its commitment to increasing transparency and efficiency in the distribution of social assistance (bansos) through the use of digital systems. One concrete step is the trial of the Payment ID system, which will be launched by Bank Indonesia (BI) on August 17, 2025, coinciding with Indonesian Independence Day.
Payment ID is designed as a unique digital identity representing an individual or entity in the national payment system. With the ability to accurately detect transactions, this system is expected to ensure that social assistance is distributed to the right targets.
Executive Director of the BI Communications Department, Ramdan Denny Prakoso, emphasized that this trial focuses on the distribution of non-cash social assistance as part of its support for the Social Protection Program (Perlinsos).
“The use of Payment ID will be based on the consent of the data owner (private consent-based) and fully subject to the protection of Law Number 27 of 2022 concerning Personal Data Protection,” said Denny.
Payment ID will also be linked to the recipient’s National Identification Number (NIK) and transaction history, allowing for more precise verification. While promising efficiency and transparency, payment system observer Arianto Muditomo warned of several crucial challenges in its implementation, such as data fragmentation between institutions and the potential for digital exclusion.
“Each ministry has different standards and data systems. Integration through Payment ID will require data format alignment, cross-system information exchange, and complex regulatory harmonization,” said Arianto.
In line with this, the government is also preparing a pilot project for digitizing public services in Banyuwangi. M. Firman Hidayat, a member of the National Economic Council (DEN), explained that all residents in Banyuwangi will receive a digital ID integrated with a biometric verification system and financial transaction system.
“We can objectively determine who is eligible to receive social assistance. If someone owns four cars and spends IDR 20 million per month, that will certainly be taken into consideration,” Firman explained.
This project is scheduled to begin in September 2025 and is targeted to expand nationally by 2026. By integrating digital IDs, data exchange platforms, and digital payments, the government hopes to make social assistance governance more accountable, inclusive, and free from manipulation.
This step also addresses the low effectiveness of social assistance, which continues to face classic challenges, ranging from duplicate data, ineligible recipients, and citizens without legal identification.
With this initiative, the government demonstrates its commitment to promoting a technology-based social protection system that is not only efficient, but also fair and transparent. (*/rls)
