KBLI Indonesia is the official classification system used by the government to categorize business activities into five digit codes. These codes serve as the basis for issuing the Business Identification Number (Nomor Induk Berusaha or NIB), determining business risk levels under the Online Single Submission Risk Based Approach system (OSS RBA), and establishing tax and investment classifications in Indonesia.
Since the implementation of KBLI 2025 on 18 December 2025, the role of this system has become increasingly strategic. KBLI is no longer merely a statistical instrument, but a core foundation of Indonesia’s risk based business licensing framework. All business entities are required to adjust their classification codes no later than 18 June 2026 to remain compliant with the latest regulations.
This raises an important question: what is KBLI Indonesia in a comprehensive sense, and why does it have such a significant impact on business sustainability?
What Is KBLI Indonesia?
KBLI stands for Indonesian Standard Industrial Classification (Klasifikasi Baku Lapangan Usaha Indonesia). It is the national standard used to group economic activities based on similarities in production processes for goods or services.
The development and updating of KBLI fall under the authority of Statistics Indonesia (Badan Pusat Statistik or BPS), pursuant to Law Number 16 of 1997 concerning Statistics. Its structure is aligned with the International Standard Industrial Classification of All Economic Activities issued by the United Nations Statistics Division to ensure global comparability of Indonesia’s economic data.
The fundamental principle of KBLI is activity homogeneity. Business activities are classified based on the nature of the economic process conducted, rather than company size, geographic location, or legal form. Both small enterprises and large corporations are categorized according to their core operational activities.
In the digital economy era of 2026, KBLI has evolved into a key pillar of business legality. It determines whether a company can operate smoothly within the regulatory framework or encounter administrative barriers at an early stage.
Why Is KBLI Important for Businesses?
Consider a technology startup being established in Indonesia. Without selecting the correct KBLI code, the OSS system will not issue a NIB. Without an NIB, a corporate bank account cannot be opened. Without a bank account, business operations may be delayed before they even begin.
The strategic functions of KBLI include:
- Basis for issuing the NIB
The OSS RBA system requires the selection of a five digit KBLI code before business legality can be processed. - Determination of business risk level
Each KBLI code is mapped into a specific risk category: Low, medium low, medium high, or high. The assigned risk level determines whether a business only requires an NIB or must obtain additional standard certificates and operational licenses. - Determination of investment capital requirements
For Foreign Direct Investment (Penanaman Modal Asing or PMA), the minimum capital requirement of IDR 10 billion applies per five digit KBLI code within a single project location. Selecting unnecessary or inappropriate codes can significantly increase capital obligations. - Tax synchronization
The Directorate General of Taxes uses KBLI as a reference for establishing the Business Field Classification (Klasifikasi Lapangan Usaha or KLU). A mismatch between KBLI and KLU may trigger tax review or audit. - Banking risk analysis and financing access
Financial institutions rely on KBLI codes to assess industry risk exposure and determine financing eligibility, including access to sustainable or green financing programs.
For these reasons, understanding what is KBLI Indonesia is not merely an administrative requirement, but a strategic business decision.
Who Is Required to Use KBLI?
KBLI applies to all formal business entities operating in Indonesia, including:
- Domestic Investment Limited Liability Companies (Perseroan Terbatas Penanaman Modal Dalam Negeri or PT PMDN)
- Foreign Investment Limited Liability Companies (Perseroan Terbatas Penanaman Modal Asing or PT PMA)
- Limited Partnerships Commanditaire Vennootschap or CV
- Small and Medium Enterprises (Usaha Mikro Kecil dan Menengah or UMKM)
- Digital startups
- Technology platforms
- Individual business entities registered through OSS
Each entity must register at least one primary KBLI code that reflects its main revenue generating activity. Additional supporting KBLI codes may be added if required by operational scope.
How Does the Five Digit KBLI Code Structure Work?
The KBLI system follows a hierarchical structure consisting of five classification levels:
| Level | Code Format | Function |
| Category | Alfabet (A to V) | Broad classification of economic sectors. |
| Principal Group | 2 Digit Number | Further breakdown of a category based on the nature of activities. |
| Group | 3 Digit Number | More specific classification of economic activities within the principal group. |
| Subgroup | 4 Digit Number | Technical description of economic activities, generally aligned with the ISIC (International Standard Industrial Classification of All Economic Activities). |
| Class | 5 Digit Number | The most detailed classification level, tailored to Indonesia’s economic structure. |
For example, code 46312 refers to wholesale trade of fruits. Category G represents wholesale and retail trade. Code 46 refers to wholesale trade excluding motor vehicles. Code 463 indicates wholesale of food, beverages, and tobacco. Subgroup 4631 relates to wholesale of food products. The final digit 2 specifies fruit trading.
A zero at the end of a code generally indicates no further subdivision. The number nine is commonly used for miscellaneous activities within a category.
Understanding this structure ensures that businesses align their actual operations with the correct regulatory classification.
What Changed in KBLI 2025?
KBLI 2025 represents a significant update compared to the 2020 version.
Key changes include:
- An increase to 22 main categories
- Alignment with ISIC Revision 5
- Restructuring of the information and communication sector
- Formal recognition of artificial intelligence based services
- Specific classification for data centers and cloud computing services
- Recognition of digital content creators and podcast activities
- Separate classification for Carbon Capture and Storage within the green economy framework
- Recognition of Factoryless Goods Producers as part of the manufacturing sector
The consolidation of five digit codes through merging similar risk profiles aims to simplify licensing processes while maintaining regulatory oversight.
Risks of Selecting the Wrong KBLI Code
Incorrect KBLI selection can have substantial consequences.
Businesses may face rejection of license applications in the OSS system if the chosen code does not accurately reflect actual activities. Selecting a lower risk category than the true operational risk may be considered administrative noncompliance.
For foreign investors, an incorrect code may trigger additional capital requirements or result in application rejection if the business field is restricted under investment regulations.
Furthermore, inconsistencies between KBLI classification and operational activities may create obstacles in submitting Investment Activity Reports (Laporan Kegiatan Penanaman Modal or LKPM), increase the likelihood of tax audits, and limit access to financing.
Practical Guide to Determining and Amending KBLI
Selecting the appropriate KBLI code should follow a structured approach:
- Define business activities comprehensively, from operational processes to output.
- Search for relevant five digit KBLI codes through the official Statistics Indonesia or OSS portal.
- Identify the primary KBLI code and supporting codes where applicable.
- Ensure compliance with foreign investment restrictions and zoning regulations.
If an incorrect code has already been registered, the company must amend its Articles of Association through a General Meeting of Shareholders (Rapat Umum Pemegang Saham or RUPS), execute the amendment before a notary, and update the data within the OSS system. Migration to KBLI 2025 must be completed before 18 June 2026 to maintain legal validity.
Is KBLI 2020 Still Valid in 2026?
KBLI 2025 became effective on 18 December 2025, with a transition period granted until 18 June 2026.
After this deadline, KBLI 2020 codes can no longer be used for new license applications or data amendments in the OSS system. Companies that fail to complete migration may encounter administrative restrictions.
Conducting an internal audit of existing KBLI classifications is strongly recommended during the first half of 2026.
At this stage, many companies recognize that classification errors are not merely administrative issues, but strategic risks that may affect long term growth.
The Role of XPND in KBLI Compliance Strategy
In an increasingly complex regulatory environment, understanding what is KBLI Indonesia alone is insufficient. The greater challenge lies in implementing the correct classification within a company’s legal structure.
XPND acts as a strategic partner for domestic and foreign businesses to ensure that their business classifications are aligned with current regulations. This includes analyzing operational activities, mapping accurate KBLI codes, amending corporate documents, and synchronizing data within the OSS system.
For PT PMA, proper KBLI selection directly affects capital obligations and investment restrictions. For digital startups, accurate classification determines access to incentives and financing. For UMKM, correct alignment ensures uninterrupted licensing processes.
XPND focuses not only on obtaining licenses, but also on developing long term regulatory strategies so that KBLI structures support business expansion, financing access, and sustainable fiscal compliance.
In the digital economy landscape and the transition toward KBLI 2025, selecting the correct five digit classification is no longer a simple administrative formality. It is a structural foundation for business stability and growth.
Ensuring alignment between actual business activities and official classification is a strategic step that should not be delayed.
