Indonesia's financial sector has special term information in the diverse fields of the economic activity. OJK-Pedia dictionary created with the goal of becoming the Financial Services Authority, which provides descriptions of hundreds of terms that are indexed information relating to the world of banking and finance.



A right to obtain the proprietary without having to file claim, particularly in case of any insolvency or bankruptcy; In bankruptcy law, abandonment is an instrument to return the security to the secured creditor, under the approval of trustee.

Ability to pay

Debtor’s ability to pay principal debt and the interest derived from income and/or profit; paying power.

Absolute title

The highest right which can be obtained through right registration, for instance, through land registration. The right is absolute in nature which is irrevocable by any whatsoever party; In Indonesia, the land right has social function.


A type of merger called "absorption" when a small firm (the acquired firm) is folded into the acquiring company, so that the true identity of the small firm does not appear anymore.


A summary of statement, report, paper, and others that is written systematically and comprehensive.

Abstraction of bank funds

Illegal bank funds withdrawal (for example: embezzlement or misuse of authorization), cash, escrow account, trust account, and other accounts.

Accelerated depreciation

A method used to accelerate depreciation, so that the amount of depreciation taken each year is higher during the earlier years of an asset’s life; for instance for a machine, the depreciation period is faster than its lifespan; accelerated depreciation is made by forming larger depreciation reserves than usual.

Acceleration Clause

A clause stipulated in a credit/loan agreement which obliges the debtor to fasten the payment of debt in total (principal and interest) in case the debtor falls into defaults; The criteria of non-performing loan are failure or negligence in paying the interest, the principal, or sinking fund, bankruptcy, and negligence in paying tax on the insured property.

Acceleration Coefficient

The ratio of changes in total investment and consumption, which shows the level of influence in changes of consumption.


A promise to pay by an interested party by signing bill of exchange; acceptance shall be declared with the word ‘acceptance’ or other way with similar meaning; by putting a signature of the drawee on the front page, the bill of exchange is valid as acceptance; this bill of exchange then becomes a promissory note, which means it is a tradable instrument and can be sold to other party before its maturity.

Acceptance Commission

The expense charged by a bank as a commission for using its name in accepting a draft.

Acceptance Ledger

The prediction to book the draft letters which are already accepted; In general, the draft acceptance prediction contains data concerning the customer’s name and address, L/C number, acceptance number, acceptance value, and maturity date.

Acceptance Register

A register which contains a list of complete details of all accepted bill of exchange; in addition to bill of exchange details, acceptance register book also contains data regarding name of authorizer bank, signature specimen of the authorized party, and list of documents.


A party who is interested in accepting bill of exchange.

Access device

Bank card or personal authorization number that can be used by bank customers to perform any transaction or deposit money, withdrawal, transfer, or pay automatic bills electronically; financial institution only issues such access upon request from customers.

Accommodation endorsement

An endorsement made by an endorser by permitting to use the endorser’s name as a favor to help other party to obtain fund through selling bill of exchange. The endorser is usually a reputable third party (called an accommodation, endorsement, or accommodation party) acting as guarantor. Although the endorser/guarantor has no interest over the bill, the guarantor remains liable under the law.

Accommodation paper

Bill of exchange signed by a drawee, acceptance, or endorser by acting as guarantor as a favor to help other party gains funds through selling the bill; although the guarantor has no interest over the bill, the guarantor will remain liable under the laws.

According to value (Ad valorem)

This term is commonly used with regards of tax imposed on imported items according to the value, not the weight, size, or unit; Ad valorem customs duties are defined according to the value (money), not the weight, size, or unit, for example, credit provision is set at 1% of the total amount set forth in a credit agreement.


A record in the ledger regarding changes in value of the entire asset or belongings, income, expenses, and certain subject debt which is done systematically and chronologically from time to time; If a person is mentioned to have an account in a bank; it means the person has savings or debt in a bank.

Account - accounting

A process of recording, classifying, and summarizing of company's financial transactions as well as preparing financial statement and its analysis; this also means that accounting is an information system to accumulate, process, and communicate all related financial transactions of all people involved in.

Account - cost accounting

A branch of accounting that relates to method and system of direct and indirect posting system derived from bank services of various units in the bank; cost accounting also records all expense which includes any kind of cost, such as overhead cost (building rental, utilities, and supporting administration cost, manager salaries, marketing cost including advertisement and promotion).

Account - public accounting

An accountant providing accounting services to clients other than employees of companies in which the accountant provides the services for.

Account activity

Activities of an account.

Account activity

All recorded transaction activities within an account derived from, among others, savings, withdrawal, credit of income, and charging administration fee at a certain period of time; posts of those transaction activities are recorded in current account under the condition that it should be issued at the beginning of each month so that the account holders can cross-check it.

Account balance

The amount available in the account after charging the withdrawal service cost, debiting, and crediting the installment, clearing of cheques which can be used for reconciliation process by comparing bank’s report to the book or cheque register; this account balance in credit is referred to as debit balance.

Account- inflation accounting

Account that shows impact of inflation against an asset value by comparing the current asset value with the value when the asset was bought.

Account Payable

A short-term debt list of individuals or companies which happen due to buying of goods and or services.

Account receivable

Individual and/or enterprise short-term receivable which accrues due to goods and service sales.

Account receivable turnover

A ratio or total sales ratio in credit against the average receivable during certain accounting period; this process constitutes the financial efficiency metering of a business organization in changing the receivable into cash.

Account reconciliation

Service provided by a bank to the customers by reporting the customers’ financial position to match with the customers’ records.

Account register

A book to record numbers, names, addresses, dates, and other information regarding the opening or closing of customer accounts.

Account Relation

Cooperation between two parties engaged in a fund transfer in the future, such as between buyer and seller, or an approval from a party to keep fund for other party.

Account Statement

A summary statement of transaction activities that occurs during a certain period of accounting time, usually monthly, quarterly, or certain time intervals; For example, a summary statement about all paid cheques, savings, deposits, and account balance in a stated period of time.


The production of financial records, theory and customs, norms, principles, etc. Accord: peace agreement agreed by both parties, one who bears the loss and one who causes the loss; this agreement is usually made in front of a judge with the purpose to prevent misunderstanding in the future.


A person who is qualified and meets certain requirements as an expert in accountancy or accounting.


A record in the big book regarding changes in value of the entire asset or belongings, revenue, expense, and certain subject debt which is done systematically or chronologically that it becomes clear from time to time; if it is mentioned that a person has an account in a bank, it means that person has savings or debt in a bank.

Accounts uncollectible

Non-performing loan that has been written-off or feasible to be written-off and that constitutes the loss for the bank; although the loan has been written-off, the bank still has the claim; see non-performing loan.

Accrual basis

Expense and income determining system which acknowledges the entire income and expenses in certain year book although the realization will only happen in the next year book.

Accrued interest

An interest of which has been taken into account as a company income or expense, but has not yet received or paid in reality.


Periodical addition over a principal amount, for instance, profit added to capital, reserves, interest over savings, or debt principal; accumulation of account.


A tool in an electronic machine to register and store data separately into similar type of data.

Acid test ratio; quick ratio

Comparison between total amount of cash, bank, trade receivables, and easily sold securities and the total current payable; This ratio is used to measure the company’s ability to immediately repay its current payables.


Acquiring of part (more than 50%) or the entire ownership of a bank.

Acquit fance

A document of written receipt of redemption of a liability; such proof of payment of a debtor is freed him/her from the obligation to pay securities; when a debtor has settled his last installment of a mortgage, creditor will issue a document indicating that debtor loan has been paid off.

Act of bankruptcy

A petition requested by either debtor or creditor to court, which may cause any party to be declared bankruptcy; specifically for banks in Indonesia, petition of bankruptcy can only be made by Bank Indonesia due to the bank cannot apply for petition of bankruptcy by itself.

Act of honor

An action from another party to accept or pay a draft with the approval of the holder by writing it down on the draft; if the holder refuses the interference, the holder loses the recourse right; another party can be a party who is not recorded as a payable on the draft, and the draft has previously been protested because it is neither accepted nor paid.

Action of debt

An action taken solely to get back the amount of money owed by another party.

Active account

A customer's bank account that is actively mutated between deposit and withdrawal.

Active partner

Participants in limited partnership who have management authority and being severally and collectively responsible under their personal assets to the third party.

Active realizable; current asset

Assets in the form of cash or other valuable goods in which can be changed into cash money at anytime.

Active stocks

Listed stocks which are frequently and heavily traded in a stock exchange.

Activity organization chart

A picture which shows the activities done by each unit in an organization.

Additional Collateral; Side Collateral

Additional assets put up as collateral by a debtor against the debt obligations and are used to lessen the risk to bank; such collateral can be assets or personal guarantees.

Add-on rates; add-on interest

A method of calculating interest payments using a percentage of desired principal loan to calculate interest cost; the interest costs is then added to the principal loan to calculate the total amount to be paid by the borrower.

Adjective Law

Legal provisions that govern court proceedings concerning settlement of dispute.


To hear and settle a case by judicial procure; this is different from settlement of dispute at arbitration.

Adjudication order

A court verdict which states that a debtor has been declared bankruptcy that the possession and the settlement of the debtor’s assets are submitted to the trustee for the interest of creditors.

Adjustable Rate Mortgage (ARM)

A mortgage with periodically adjustable interest rate, generally once in every six months.

Adjusted Capital Ratio

Capital ratio which has been adjusted towards the total asset; This ratio is used in calculating capital sufficiency; Bank’s capital calculation is done by counting the provision for bad debt/non-performing loan, reserve for securities’ loss or profit subtracted by credit that is classified as non-performing loan.


An insurance expert who assesses and settles loss claim; it is related to the suspension of bank activity, the settlement party means the party appointed to complete all things related to the settlement of rights and obligations of the bank.

Administered price

Price of goods or services governed by government, for example fuel price and electricity base tariff.

Advance commitment

A written agreement to do an activity in the future under agreed requirements and conditions when the agreement takes place; the most popular example is agreement contract or commitment by a financial institution to give loan to a borrower/debtor at a certain time in the future with certain previously agreed requirements, such as agreement account statement loan.

Adverse of opinion

See audit report.

Adverse Opinion

A financial audit report by an independent auditor stating that the company’s audited financial statement does not reflect the real financial condition.

Adversely classified assets

Earnings assets in which the collectability is categorized as substandard, doubtful, and non-performing; earnings assets in this context means credit, investment at other bank, securities owned, and capital participation.


A written confirmation or notice from a bank to a customer concerning receipt of payment, transfers of funds, services or payment performed, for example: notification of credit, account debit, withdrawal, or funds transfers.

Advising bank

A bank that corresponds an L/C from the issuing party to the receiving party without any bind to any provisions of the L/C agreement being corresponded; the correspondent is made after there is a certainty in the correctness of code or signature from the opening bank of L/C.


A voluntary declaration of facts written down and sworn to by an affiant under an oath or affirmation administered by a person authorized to do so by law, for example, an appointed attorney, consul or notary; affidavit also serves as evidence to its veracity and testimony for the court proceedings.


1.     Member of board of commissioners or supervisors of directors, officials, or employees of the bank; 2. Member of management, inspection board, directors, officials, or employees of the bank, specifically for bank with cooperatives legal entity nature, it is pursuant to the prevailing laws and regulations; 3. The party which provides service to the related bank, including consultant, legal counsel, public accountant, assessor; 4. The party which is based on the terms stipulated by Bank Indonesia means taking part to influence bank management (Laws No. 7 of 1992 concerning Banking).

Affiliated Company

A company which is controlled effectively by another company, or is affiliated to one or more companies due to a certain interest, or ownership, or same management board.

After Acquired Property

A property which is placed in bankrupt asset after a bankrupt decision is charged.

After hours

The time that becomes the basis to determine whether a transaction has been made in the relevant business day, or in the subsequent business day; the time may be clearing hours, cash hours, and business hours for bank.


A person or entity authorized or appointed to represent or act on behalf of another person or another entity, and has permanent relationship with the one being represented; a bank may also act as an agent in several activities, such as being a custodian or trustee.

Agent bank

A bank that is appointed by members of a bank group, which provides syndication credit, to manage the interest of the related banks; the performing bank is responsible to inform the other members of the bank group regarding any withdrawals or savings done by the debtor as well as the change in interest rate; see syndication.

Aging Account Receivable

Receivables classification according to its period; generally, it is prepared every month in relation to trial balance sheet, which covers name and address of customer or identification of account number, total receivables, and receivables period.

Aging Schedule

Classification of account receivable based on the selling dates, usually used by a credit guarantor.


1)     An excess obtained from exchange of gold or silver coins with paper money in foreign currency but the same nominal value; this term is commonly used in European banking: see also: premium. 2)    The difference between actual and nominal value of securities or foreign currency, and depreciation of metal currency due to metal being worn-out.

Agreement - Cardholder Agreement

A written agreement between a card holder and card issuer that contains terms and conditions and duration of the card; in terms of credit card, the agreement states annual interest rate, minimum payment per month, annual membership fee if any, and the card holder rights when disputes in payments arise.

Agreement - Credit Agreement/Contract

A legal credit/loan contract between a bank and its debtor customer regarding a certain amount of money for a specified amount of time. The credit agreement outlines all the rules and regulations associated with the contract. This includes the the credit/loan amount, withdrawal process, credit/loan repayments, credit/loan interest, and credit/loan tenor.

Agreement - Exchange Clearing Agreement

A bilateral agreement as to the settlement method of obligation payment through the central bank of each country.

Agreement - Extension Agreement

An approval of a creditor to extend the credit/loan due date. Creditors are usually willing to extend when they are certain the debtor’s financial condition will improve in the future; extension agreement.

Agreement - General Agreement on Tariff and Trade (GATT)

An agreement among non-communist countries regarding international trade relations in 1948; the agreement purpose is to encourage mutual benefit bilateral cooperation by lowering tariffs, prohibition, and state boundaries.

Agreement - Labour Agreement

An agreement made between a company and every employee of the company that contains provisions concerning the rights and obligations of each party (employer and employee).

Agreement - Merchant Agreement

A written agreement between a merchant and a card issuer bank; this agreement provides guarantee and rights to the merchant with respect to the bank card received, discount rate, and procedures to settle disputed transactions.

Agreement - Mortgage Swap Agreement

A swap of mortgaged goods and its documents or through av guarantee supported by the same mortgage; lenders of mortgaged goods mostly are prudent institutions; swapping mortgaged goods to Federal Home Loan Mortgage Corporation (Fredie Mac) will obtain guarantee guaranteed by Fannie Mae or Fredie Mac to improve the asset quality, acquire the agreed guarantee for repurchase agreement provisions to maintain the asset price balance not to be lower or for other purposes.

Agreement - Overnight Repurchase Agreement

A form of short-term borrowing for dealers in government securities. The dealer sells the government securities to investors, usually on an overnight basis, and buys them back the following day. For the party selling the security (and agreeing to repurchase it in the future), it is a repo; for the party on the other end of the transaction (buying the security and agreeing to sell in the future), it is a reverse repurchase agreement. See also: repurchase agreement and reverse repurchase agreement.

Agreement - Repurchase Agreement

An agreement where a bank agrees to buy securities and sell them back later at a set price and specified date; this agreement is called repo or RP (repurchase agreement).
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