Conventus Law

Conventus Law

by

SSEK Law Firm partner Winnie Yamashita Rolindrawan and associates Ruth M. Ginting and Farrah Azizah Habibie provide an in-depth overview of the fast-evolving fintech sector in Indonesia, including the licensing and marketing of fintech companies, in The Financial Technology Law Review.

Fintech companies in Indonesia are regulated by Bank Indonesia (BI) and the Financial Services Authority (OJK), with each having its own scope of authority. L aw No. 4 of 2023 regarding the development and strengthening of the financial sector (P2SK Law) defines technology innovation in the financial sector to include activities such as payment systems, capital raising, investment management, risk management, cryptocurrencies, and other digital financial services and activities. The OJK regulates fintech activities related to financial services, whereas BI regulates fintech activities related to payment systems.

The OJK has put in place provisions and extensive criteria for regulated fintech activities related to financial services, which are regulated under OJK Regulation No. 13/POJK.02/2018 regarding digital financial innovation in the financial services sector, dated 16 August 2018 (OJK Reg 13). These criteria include being innovative in nature and future-oriented, using information and communications technology as the primary basis for providing financial services to consumers, and supporting financial inclusion and literacy. Providers that meet these criteria are required to register with the financial regulatory bodies. Companies engaged in digital financial innovation in the financial services sector are also required to register or obtain a licence, unless otherwise exempted.

Fintech activities related to payment systems

BI regulates fintech activities related to payment systems under various regulations, including BI Regulation No. 22/23/PBI/2020 regarding payment systems, dated 30 December 2020 (BI Reg 22), BI Regulation No. 23/6/PBI/2021 regarding payment service providers, dated 1 July 2021 (BI Reg 23/6), and BI Regulation No. 23/7/PBI/2021 regarding payment system infrastructure providers, dated 1 July 2021 (BI Reg 23/7). The regulation of fintech companies by BI is also explicitly addressed in the P2SK Law, with payment systems included as one of the activities of technology innovation in the financial sector. New implementing regulations on this matter are expected.

No specific regulations in Indonesia currently govern the marketing measures that fintech companies can undertake, but companies must comply with general regulations governing advertising and promotion. Fintech companies should also ensure that their marketing practices comply with recently issued regulations on consumer protection in the financial services sector.

Artificial intelligence

Even though there is no specific law or regulation in Indonesia for automated digital advisory services, investment management and market support activities that use artificial intelligence (AI), machine learning, big data and other technologies fall under technology innovation in the financial sector. Companies providing these services must comply with sandbox mechanisms under the P2SK Law and OJK Reg 13.

Any party that wishes to establish an asset management company in Indonesia must refer to the activities of an investment manager (IM) company operating on the Indonesia Stock Exchange pursuant to Law No. 8 of 1995 regarding capital markets, dated 10 November 1995, as amended by the P2SK Law (the Capital Market Law). Other than the requirement for the company to be established in the form of an Indonesian limited liability company (PT), the company must also be registered as a securities company, specifically as an IM company, for which a licence must be obtained from the OJK, pursuant to the Capital Market Law.

Credit information services

Credit information services are regulated in OJK Regulation No. 5/POJK.03/2022 regarding credit information management agencies, dated 28 March 2022, and OJK Circular Letter No. 27/SEOJK.03/2022 regarding credit information management agencies, dated 22 December 2022. Under these regulations, a credit bureau is referred to as Credit Information Management Institution that collects and processes credit or financing data and other data to produce credit information, and they must obtain a business licence from the OJK.

Excerpted from The Financial Technology Law Review, published by Law Business Research Ltd.

Find The Financial Technology Law Review: Indonesia here.

This publication is intended for informational purposes only and does not constitute legal advice. Any reliance on the material contained herein is at the user’s own risk. All SSEK publications are copyrighted and may not be reproduced without the express written consent of SSEK.

WRITTEN BY

For further information, please contact:

Winnie Yamashita Rolindrawan – SSEK,
winnierolindrawan@ssek.com

Winnie Yamashita Rolindrawan - SSEK. Winnie Yamashita Rolindrawan holds a Bachelor of Laws in economic law from the University of Indonesia and a Master of Science in communications management. She also earned an LL.M. and a Business Law Certificate from UC Berkeley.

Winnie Yamashita Rolindrawan received her Bachelor of Laws in economic law from the University of Indonesia in 2002. In 2007, she earned her Master of Science from the Faculty of Social and Political Sciences at the same university, majoring in communications management. In 2016, Winnie received her Master of Laws (LL.M.) from the University of California, Berkeley, School of Law, where she also earned a Business Law Certificate from the Berkeley Center for Law and Business.

Winnie joined SSEK in 2007 and has represented major domestic firms and multinational companies in a variety of transactions. She has worked on numerous projects involving M&A, financial services and fintech, data privacy, pharmaceuticals and healthcare, corporate and commercial matters, foreign investment, e-commerce, and real estate and property (particularly hotels).

Her projects in the fintech sector include acting as Indonesian counsel to Didi Chuxing in the acquisition of a substantial stake in Grab Inc., a transaction valued at over US$1 billion, and acting as lead Indonesian counsel to Mastercard as the lead investor in the series B funding round of Digiasia, an Indonesian fintech startup. Winnie advises clients on all aspects of fintech and payment systems (including e-money, remittances, payment gateways and switching), from obtaining the relevant licenses to cross-border fintech M&A transactions and navigating complex regulatory, legal and commercial challenges to ensure compliance with the relevant fintech and payment system regulations of Indonesia’s Financial Services Authority (OJK) and Central Bank (Bank Indonesia).

In the healthcare sector, Winnie has represented pharmaceutical companies, including manufacturers and distributors, in providing practical solutions for their day-to-day operations, corporate and commercial contracts, and specific regulatory issues.

Prior to joining SSEK, Winnie worked at another prominent corporate law firm in Jakarta, where she was involved in various capital market transactions including IPOs, bond issues and rights issues. She helped handle several debt restructuring projects involving the Indonesian Bank Restructuring Agency (IBRA), an independent government agency established in response to the Indonesian financial crisis.

Winnie was also an associate procurement expert for an Asian Development Bank-Indonesian Ministry of National Development Planning (Bappenas) project, where she developed and drafted model national procurement documents.

Winnie is a licensed attorney and a member of the Indonesian Advocates Association (Peradi). She participated in the 2014 Academy of American and International Law, sponsored by the Southwestern Institute for International and Comparative Law in Dallas, Texas.

Having spent her childhood in Hamburg, Germany, she speaks German in addition to English and her native Indonesian.

Register for your monthly Asia legal updates from Conventus Law

Error: Contact form not found.

RELATED ARTICLES