Indonesian payment switching firm Artajasa Pembayaran Elektronis has partnered with Mastercard to bolster the overall capability of National Payment Gateway (NPG) ecosystem.

The co-operation agreement has been approved by the central bank of the country.

Currently, the partnership will process and manage debit card transactions within Indonesia.

In future, Mastercard and Artajasa may work together to include other transaction processing such as digital payments in e-commerce.

As a part of the collaboration, Mastercard will bring its security solutions to bear for all domestic debit card transactions.

The partnership comes at a time when the Indonesian government is encouraging digital transactions.

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As a part of its efforts, Indonesia introduced its national payment gateway system in December 2017. The move was taken to ensure all domestic debit card transactions are settled using Indonesian infrastructure.

Mastercard division president for Indonesia, Malaysia & Brunei Safdar Khan said: “We fully support Bank Indonesia’s vision of increasing the penetration of digital payments in the country. The addition of safety tools to the NPG will increase the confidence of consumers and merchants to use debit cards when making and accepting payment for everyday purchases.

“Through our co-operation with Artajasa, Mastercard plans to introduce additional innovations like tokenisation to deliver an extra layer of security to online and face-to-face cashless transactions. Interoperability within the NPG ecosystem means that Mastercard will also be able to add value to all inter-bank Mastercard debit card transactions.”

Recently, Mastercard agreed to acquire some businesses of Denmark-based payments group Nets for €2.85bn ($3.19bn).

The deal includes clearing and instant payment services, and e-billing solutions of Nets’ Corporate Services business.