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OJK Publishes Latest Fintech Lending Rules

 


The Financial Services Authority (OJK) has issued new principle-based rules for the fintech p2p lending industry. This rule is expected to be more flexible in accommodating industry developments, while strengthening supervision through market conduct.

This regulation is attached to the Financial Services Authority Regulation (POJK) Number 10/POJK.05/2022 concerning Information Technology-Based Joint Funding Services (POJK LPBBTI/Fintech P2P Lending). This POJK is effective since its promulgation on July 4, 2022 and simultaneously revokes POJK 77/2016.

"The POJK LPBBTI was issued to develop a financial industry that can encourage the growth of alternative financing, facilitate and increase access to funding for the community and business actors through an information technology-based funding service," said Deputy Commissioner for Public Relations and Logistics Anto Prabowo, Friday (15/7).

He said that this regulation enhances the old regulation issued in 2016. The latest POJK Fintech P2P Lending was issued in order to accommodate the rapid and more contributive development of the industry and provide optimal regulation on consumer protection.

The general explanation of the regulation explains that the development of the LPMUBTI industry has recorded very high growth, far above the growth of other IJK. The number of users continues to grow significantly.

Business models and cooperation with other parties in the ecosystem continue to grow and become more complex. This positive industry development needs to be directed to optimally contribute to the Indonesian nation by funding communities, regions, and business sectors that have not been optimally funded by existing financial institutions.

The fintech lending industry is supported by information technology with characteristics that are different from existing Financial Services Institutions, such as face-to-face transaction mechanisms, high transaction frequency, fast processing, simple requirements, including artificial intelligence (AI) support. These characteristics result in a business nature that requires supervision that is different from conventional supervisory methods.

Supervision must be carried out by utilizing information technology optimally to increase effectiveness and efficiency. Information technology support in supervision is also to be able to accommodate increasingly complex industrial developments.

The rapid development and characteristics of the industry require a principle-based regulatory model that is more flexible in accommodating industry developments. The supervisory approach also needs to be directed at market discipline (market conduct) by involving industry associations. In addition, transparency to the public also needs to be promoted so that the public can participate in assessing the quality of the industry and organizers, and can increase public confidence.

Likewise, the development of sharia fintech lending has made the term lending and borrowing less appropriate. Therefore, it is necessary to make adjustments by using a more universal term, namely information technology-based joint funding services (LPBBTI).

Through this new regulation, it is hoped that OJK's needs related to the effectiveness and efficiency of supervision can be optimized. This includes accommodating the needs of the industry so that it can develop optimally, healthily, and contribute, as well as the need for consumer protection.

Regulatory Substance

In the latest POJK Fintech P2P Lending, there are a number of regulatory substance improvements. Among them, each organizer must be a limited liability company (PT). The paid-up capital at the time of establishment is at least Rp 25 billion and first obtains an OJK license, as well as when converting to sharia.

Source : investor.id

No.10/POJK.05/2022.pdf