What are Bonds?

Bonds are securities issued by the government to raise funds. They represent a commitment to pay bondholders periodic coupon payments and return the principal amount at maturity.

Are Bonds a good investment for beginners?

Yes. Bonds are considered a stable investment with lower risk and steady returns, making them ideal for beginners. Additionally, bonds offer:

• Affordable entry (minimum purchase of Rp1.000.000)
• Government-backed security
• Easy purchase via the Jenius app
• Higher returns than the average bank deposit

What are the benefits of buying Bonds?

Besides providing regular coupon payments as passive income, bonds can also be sold in the secondary market, potentially generating additional profit (capital gains).

What is a coupon?

A coupon is the annual interest you earn while holding a bond. It is also referred to as an interest rate and can be fixed or floating with a floor:

• Fixed: The coupon rate remains the same until maturity.
• Floating with a floor: The coupon rate fluctuates but has a minimum (floor) set by the bond issuer.

Coupons are calculated annually (p.a.), meaning they are evenly distributed throughout the year. For example, if a bond has a fixed 5% annual coupon, the monthly payout isn’t principal × 5% directly, but rather (principal × 5%) ÷ 12 months.

Who issues Bonds?

There are two types of bond issuers:

• Government (Ministry of Finance of Indonesia)
• Corporations
• Currently, Bank SMBC Indonesia only offers government bonds for added security and stability.

Are Bonds protected by LPS like Deposits?

No, bonds are not bank products and are not covered by the Indonesia Deposit Insurance Corporation (LPS).

Are Bonds guaranteed by the government?

Yes, all government-issued bonds are backed by the Republic of Indonesia. The principal repayment at maturity and periodic coupon payments are guaranteed by law (Law No. 24 of 2002, Article 8, Clause 2 on Government Bonds).

What is the difference between the Primary and Secondary Market?

Primary Market: Bonds are sold directly by the issuer for the first time (e.g., ORI or Retail Sukuk).

Secondary Market: Bonds are resold by previous holders to new buyers.

What are the risks of investing in Bonds?

Liquidity Risk
Bond investments are locked for a certain period. Early redemption or selling is regulated by the Ministry of Finance and cannot be done at any time.

Maturity Risk
The longer the bond’s maturity, the greater the uncertainty of principal repayment, increasing risk for investors.

Market Risk
Bond prices fluctuate based on interest rates. Prices rise when interest rates drop and vice versa. Investors should consider interest rates, inflation, and yield to maturity (YTM) before investing.

What types of Government Bonds are available at Jenius/Bank SMBC Indonesia?

Currently, Bank SMBC Indonesia offers FR (Fixed Rate) bonds, which are transacted in Indonesian Rupiah (IDR), and INDON bonds, which are transacted in US Dollars (USD).

What does Fixed Rate mean?

Fixed Rate bonds have a fixed coupon rate until maturity. For example, FR0101 offers a 6.875% annual coupon for five years.

What are the benefits of buying FR bonds?

FR bonds have a 10% tax on both coupons and capital gains, which is lower than the 20% tax on bank deposits.

What are the benefits of buying INDON bonds?

Unlike FR bonds, INDON bonds are exempt from taxes on both coupons and capital gains.

How do I open a Bond Account at Bank SMBC Indonesia?

• Become a customer of Bank SMBC Indonesia.
• Own a savings or checking account at Bank SMBC Indonesia.
• Apply for a Single Investor Identification (SID).

How do I open a Bond Account in Jenius?

• Open the Wealth page from the bottom navigation bar, go to Investment, scroll to the Bonds section, and select Open a Bond Account.
• Complete the Risk Profile Quiz (if you haven’t), fill out the Bond Registration Form, and submit the required personal data. Your investment account will be opened within a maximum of two stock exchange working days.

What if I already have an SID or have traded Bonds elsewhere?

If you have previously traded Bonds through another platform, you still need to open an investment account in Jenius or Bank SMBC Indonesia so your SID (Single Investor Identification) is recorded in the bank’s internal system.

However, if you have purchased Bonds through a Bank SMBC Indonesia branch and now wish to buy through Jenius, you do not need to open a new account.

What documents are required to apply for an SID?

For Indonesian citizens (WNI): Ensure your Jenius profile is updated with your current National ID (KTP), then prepare the account opening form and risk profile questionnaire.

For foreign nationals (WNA): SID registration can only be done at Bank SMBC Indonesia branches. You will need a valid passport, an account opening form, and a risk profile questionnaire.

How long does it take to create an SID?

2 working days, provided that your personal data matches the official records in Dukcapil (Indonesia’s civil registry).

When can I start trading Bonds?

You can start trading Bonds once your SID is active and recorded in the Bank SMBC Indonesia system.

When can a bond be purchased?

Bonds can be purchased if they are within the offering period, during bourse hours, and have not yet reached maturity or the end of the offering period.

How can I purchase bonds through Bank SMBC Indonesia?

• Have an active savings or checking account (IDR/USD).
• Ensure that the account is active and not in dormant status.
• Provide funds according to the agreed amount.

Can I cancel a transaction?

Once a transaction is confirmed, it cannot be canceled.

How can I purchase bonds through Jenius?

• From the Investment menu, select View Products in the Bonds section and choose the desired bond product.
• If your preferred bond is not available yet, you only need to wait until the bond is offered during bourse hours and on the bourse days announced by Indonesia’s Ministry of Finance.
• Select the product and click Buy.
• Enter the purchase amount. Ensure you have a minimum Active Balance of Rp1.000.000 to purchase bonds via the Jenius app.
• Proceed with the purchase, verify all purchase details, agree to the terms and conditions, and submit your order.
• Your order has been sent. You will receive a notification once your purchase is successful or if it fails. If it fails, you can try purchasing again as long as the quota is available and the bond is still open for purchase.

How can I sell bonds through Bank SMBC Indonesia?

The selling process is the same as purchasing. You can sell bonds through Jenius or by visiting the nearest Bank SMBC Indonesia branch.

If you are a Sinaya Prioritas user, you can also contact your Relationship Manager for assistance.

How can I sell bonds through Jenius?

• From the Investment menu, go to the Bonds section and select the bond product you want to sell.
• Scroll down to find the Sell button. Click it to proceed.
• Enter the amount to sell and click Continue.
• Ensure the sale details are correct, agree to the terms and conditions, and submit your order.
• You will receive a notification once your sale is successful or if it fails. If it fails, you can retry selling as long as the bond is still available for sale.

How do I transact foreign currency bonds (USD) such as INDON?

For purchases at Bank SMBC Indonesia branches, you need to:

• Have an active USD account.
• Ensure sufficient funds are available as per the agreement.
• For purchases via Jenius, the process is the same as purchasing other bonds, with an additional step to activate a USD account if you do not have one yet.

If I am a foreign citizen, can I trade bonds?

Yes, foreign citizens can buy and sell Secondary Market Bonds after successfully completing the SID (Single Investor Identification) registration process at a Bank SMBC Indonesia branch.

If I already have a USD account with Bank SMBC Indonesia, do I still need to open a USD account in Jenius?

Yes, you need to open a USD account in Jenius, as it will be used for debiting and/or crediting funds for bond transactions.

Is there a specific schedule for bond transactions?

Yes, bond transactions can only be conducted on bourse days and hours:

Monday – Friday until 14:00 WIB (Western Indonesia Time).

The bank reserves the right to adjust trading hours earlier or later at its discretion.

What is a bond tenor, and why do bonds have a tenor?

Bond tenor refers to the period during which an investor holds the bond. Bonds must have a tenor because they are a debt instrument.

All debt instruments have a tenor until maturity, which is when bondholders receive the repayment of the principal amount from the bond issuer. This marks the completion of the borrowing period.

Bond tenor vary widely, ranging from 365 days to over 5 years.

Are bond transactions subject to fees and/or taxes?

Yes. Fees and taxes for bond transactions include:

• Stamp duty: If your transaction exceeds Rp10.000.000, a stamp duty of Rp10.000 applies. However, this fee is currently covered by the bank until further notice.
• Custodian fees: These fees are also covered by the bank until further notice.
• Taxes: In general, buying or selling securities is not subject to tax. However, the coupon payments you receive are considered income and are therefore taxed. The income tax on coupons is final at a rate of 10%.

Why do I need to pay Accrued Interest when buying bonds?

Buyers must pay accrued interest to compensate the previous bondholder for the coupon earnings up to the settlement date of the transaction.

Where can I view the bonds I have purchased in Jenius or Bank SMBC Indonesia?

You can open the Jenius app, go to the Wealth menu, select the Investment tab, and scroll down to the Bonds section. Here, you will find the bonds you own. Tap on a bond to view its details.

When will I receive bond coupon payments?

Each bond has a different coupon payment date and frequency within a year. You can check the specific coupon payment schedule in the bond’s product details.

f the coupon payment date falls on a public holiday, the payment will be processed on the next business day without any additional interest.

What happens when my bond reaches maturity?

When your bond matures, the principal amount will be automatically credited to your Active Balance.