Development of a gold savings guarantee scheme in the Indonesian bullion bank ecosystem: Legal framework, institutional structures, and risk management

Abstract

Background: The development of bullion banking in Indonesia represents a strategic effort to integrate gold into the formal financial system and to support real asset–based financial inclusion. Following the enactment of Law No. 4 of 2023 and Financial Services Authority Regulation No. 17 of 2024, bullion banks have begun operating gold-based products, particularly gold savings accounts. However, this study identifies a critical structural gap within Indonesia’s bullion banking architecture, namely the absence of an explicitly designed gold savings guarantee scheme. Methods: Using a qualitative juridical-normative approach enriched with policy and risk analysis, this study examines the legal foundations, institutional arrangements, and risk characteristics of gold savings products. Findings: The findings indicate that gold savings exhibit hybrid characteristics, combining elements of commodity ownership and financial savings, especially under unallocated account structures where customers hold contractual claims rather than ownership of specific gold assets. This condition generates legal uncertainty and exposes customers to institutional and systemic risks, including the potential for gold runs during periods of financial stress. Conclusions: The study argues that a Gold Savings Guarantee Scheme is essential not only for consumer protection but also as a component of the broader financial stability framework. It proposes that such a scheme should be designed on a risk-based basis, with differentiated treatment of allocated and unallocated gold savings, clear coverage limits, and strong governance arrangements integrated with existing supervisory mechanisms. Novelty/Originality of this article: This study is among the first to design a risk-based Gold Savings Guarantee Scheme for Indonesia’s bullion banking ecosystem. It treats allocated and unallocated gold savings differently. It also links consumer protection to the broader financial stability framework. It does not treat gold savings protection as a simple extension of conventional deposit insurance.