Since implementing all feasible plans, strategies, and containment measures to avert the onset of the COVID-19 pandemic, the globe has failed to avoid the rapid spread of a novel coronavirus and its detrimental economic impact on the world. Similarly, the proliferation of COVID-19 has impacted economic stability in Indonesia and debtors' performance and capability to meet their debt commitments, which can potentially impair banking performance in debt management. Thus, drawing on historical crises and debt restructuring literature this study built on recent research (Disemadi & Shaleh, 2020) to shed light on the Indonesian government's/Central bank's debt restructuring policy and its efficacy in rehabilitating the impacted economic sector. Additionally, a comprehensive evaluation of the literature on global debt restructuring policies during COVID-19 is offered. The findings indicate that a successful banking policy directs banks to assist their clients and safeguard shareholders' interests. Additionally, the study's findings suggest that the restructuring scheme's implementation varies by context, based on each bank's regulations and appraisal of the debtor's profile and ability to pay. As a result, extreme steps are advocated during times of crisis to assist the developing economy. The authors make recommendations for future research avenues and policy consequences.