As the technology and fintech businesses keep developing, the government also needs to step up its game to catch up with the latest developments and ensure the public’s safety. The Indonesian Financial Services Authority (OJK) is planning to issue yet another regulation concerning P2P Lending. This regulation is planned to replace the existing regulation, i.e. OJK Regulation No. 10 of 2022 (POJK 10). The OJK has uploaded the first draft of the new regulation on its website for the purpose of obtaining suggestions from the public and market players. However, there is no certainty yet on when this regulation will be issued. This publication will discuss several terms that may be regulated differently compared to POJK 10.
Maximum Funding Capacity
The maximum funding capacity under the new regulation would be increased for productive lending. POJK 10 generalizes the maximum funding capacity for every kind of P2P lending. However, in the new regulation, the maximum funding capacity is differentiated into two sectors, i.e., (a) consumptive funding (IDR 2 billion or approximately USD 125,000) and (b) productive funding (IDR 5 billion or approximately USD 312,500). To qualify for this maximum funding, there are certain requirements to be fulfilled by the P2P operator.
The market players embrace this initiative positively as they believe that there is a greater need for productive funding. Some of them even suggested a higher maximum amount as they proposed that the maximum amount of the funding should be IDR 10 billion (approximately USD 625,000).
Reporting Requirements
The new regulation would add a new reporting requirement for the P2P operators. Under the new regulations, the P2P operators would be required to submit a daily report on the data of the funding transactions. The report should be submitted by integrating the electronic system of the P2P operators with the OJK’s.
Licensing Moratorium
Even though it is not specifically regulated in the draft of the new regulations, information in the market said that the OJK is also considering revoking its moratorium policy specific for the business license of P2P operators that focus on productive and micro, small, and medium-sized enterprises.
Commentary
The update on the maximum funding capacity is a good move to be carried out by the OJK. This amendment may boost the business of many productive and micro, small, and medium-sized enterprises. If the business is growing, this will for sure also bring a positive impact on Indonesian economic growth in general. It is also good that the OJK still proceeds with caution by incorporating certain requirements that must be fulfilled to be eligible to obtain the new maximum funding amount. Thus, the funding can still be justified for eligible parties only.
For Further Information, Please Contact:
MetaLAW, Legal Consultant, Jakarta, Indonesia
general@metalaw.id
