Minister's Proposal: Civil Servant Salaries via Kopdes

Minister of Cooperatives Ferry Juliantono confirmed that the government plans to redirect the disbursement of salaries for state civil apparatus (ASN (Aparatur Sipil Negara)) through the Merah Putih Village/Subdistrict Cooperatives (Kopdes (Koperasi Desa)). Ferry made the statement following a limited coordination meeting (rakortas (rapat koordinasi terbatas)) on Kopdes in Jakarta on Wednesday (14/10/2026).

According to Ferry, the submission process has been forwarded to the Ministry of Finance (Kemenkeu (Kementerian Keuangan)) and the payment scheme is claimed to be ready. 'Submitted to the Ministry of Finance. It is ready to be disbursed,' Ferry said. Currently, ASN salaries are distributed via the Association of State-Owned Banks (Himbara (Himpunan Bank Milik Negara)), PT Pos Indonesia, and Regional Development Banks (BPD (Bank Pembangunan Daerah)). However, the government cannot yet confirm when the realization of the transition will begin.

Ministry of Cooperatives: No Official Decision Yet

Secretary of the Ministry of Cooperatives (Kemenkop (Kementerian Koperasi)) Ahmad Zabadi clarified that to date, there has been no official government decision regarding the involvement of Kopdes in the disbursement of civil servant salaries or pensions. The circulating information, he explained, originated from government efforts to expand cooperative services so they become more modern and professional.

According to Zabadi, current efforts aim to make cooperatives payment partners for pensioner salaries—on par with PT Pos Indonesia and commercial banks—rather than replacing the role of banks or BPDs. Cooperatives are projected to serve as an alternative financial service channel as well as part of a cooperative transformation to remain competitive.

Asbanda and Economists Voice Concerns

The proposal has drawn resistance. The Association of Regional Development Banks (Asbanda (Asosiasi Bank Pembangunan Daerah)) urged that regional ASN payroll management remain with BPDs. Asbanda Chairman Agus H. Widodo stated that BPDs have consistently served as strategic partners for local governments and an integral part of regional financial ecosystems, including payroll services for ASNs and government employees with work agreements (PPPK (Pegawai Pemerintah dengan Perjanjian Kerja)).

Center of Reform on Economics (CORE) Indonesia economist Akhmad Akbar Susamto warned of three major risks should civil servant (PNS (Pegawai Negeri Sipil)) salaries be routed via Kopdes. First, Kopdes lacks a credible system, which could lead to delayed salary payments. 'If the Kopdes system fails, it means PNS salaries will be delayed,' Akhmad noted. Second, the condition of BPDs could worsen since a portion of their funding comes from regional PNS payroll deposits. Third, there are risks to the financial well-being of civil servants themselves. Another CORE economist, Yusuf Rendy Manilet, emphasized the importance of distinguishing between using cooperatives merely as a service channel versus transferring salaries directly into cooperative accounts.

Deputy Home Affairs Minister: Current System Functions Well

Deputy Minister of Home Affairs (Wamendagri (Wakil Menteri Dalam Negeri)) Bima Arya questioned the operational readiness of Kopdes, which he viewed as not yet optimal. According to Bima, the current payroll system for state employees—handled by Himbara and BPDs—already runs effectively, meaning any transfer plan must be examined thoroughly and prudently because 'it concerns the livelihood of every ASN'.

The stakes are indeed high. BPDs hold Rp770 trillion in third-party funds (DPK (dana pihak ketiga)) and Rp673 trillion in outstanding loans. To date, there is no certainty as to when—or whether—the plan to redirect ASN salaries to Merah Putih Kopdes will actually materialize.