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Compliance and Regulatory Issues in Fintech in Indonesia: A Growing Concern

As fintech products and services continue to gain popularity in Indonesia, regulatory bodies are working to ensure that these innovative financial solutions comply with existing laws and regulations. Two main government agencies, Bank Indonesia and the Financial Services Authority (OJK), are responsible for overseeing fintech activities in the country.

Regulatory Framework

Bank Indonesia Regulation No. 19/12/PBI/2017 outlines specific requirements for fintech companies operating in Indonesia. The regulation covers various areas such as:

  • Payment systems
  • Market support
  • Investment management
  • Risk management
  • Lending
  • Fundraising

For instance, fintech companies involved in peer-to-peer lending or crowdfunding must comply with the regulation’s guidelines.

OJK Regulation

OJK Regulation No. 13/POJK.02/2018 provides a framework for digital financial innovation in the financial services sector. The regulation covers:

  • Transaction settlement
  • Capital raising
  • Investment management
  • Fundraising and fund disbursement
  • Provision of insurance
  • Market support
  • Other digital finance supporting activities

New Regulations

Recently, the Indonesian government issued Government Regulation No. 80 of 2019 regarding Trade Through Electronic Systems (GR 80/2019) and Minister of Trade (MOT) Regulation No. 50 of 2020 as an implementing regulation for GR 80/2019. These regulations impose new obligations on organizers of trade through electronic systems, requiring them to:

  • Appoint a representative in Indonesia if they meet certain criteria
  • Companies that have completed transactions with more than 1,000 consumers in a year or delivered more than 1,000 packages to consumers in a year are also required to appoint a representative in Indonesia

Compliance is Key

As fintech continues to evolve and grow in Indonesia, it is essential for companies to stay compliant with regulatory requirements to avoid potential risks and penalties. For further information on compliance and regulatory issues in fintech in Indonesia, please contact Winnie Yamashita Rolindrawan, Soewito Suhardiman Eddymurthy Kardono at winnierolindrawan@ssek.com.