Bailout is an alternative in handling the financial
crisis. The fundamental purpose of bailout policy is for the
public interest. This research purposed to find out why the
bail-in mechanism replaced the bailout mechanism, an
alternative to handling the financial system crisis in Indonesia.
In this normative research, the secondary data were used. In
order to analyze the data, qualitative data analysis technique
was implemented. In conclusion, this research found out that
bailout in Indonesia in the case of Bank Indonesia Liquidity
Assistance (BLBI) and Century Bank showed bad impacts of
bailout implementation mechanism. Based on Law on
Prevention and Mitigation of Financial System Crises (UU
PPKSK) and its implementing regulation, the systemic bank
was now obliged to solve financial problems with its own effort
in accordance with action plan they made. This mechanism is
called the bail-in mechanism, replacing the bailout policy
mechanism in handling the financial crisis in Indonesia.