Financial Crime World

Title: Indonesia’s OJK Introduces New Regulation on IT-Based Co-Financing Services: What Businesses Need to Know

The Otoritas Jasa Keuangan (OJK), Indonesia’s financial services authority, announced a new regulation on IT-based co-financing services on August 15, 2022. This regulation aims to strengthen financial institutions’ risk management capabilities and sets guidelines for IT-based co-financing services providers.

Below are some key takeaways for businesses operating or planning to expand in Indonesia in response to this new regulation:

Covered IT-Based Co-Financing Services

The regulation covers the following IT-based co-financing services:

  • Peer-to-peer lending
  • E-money issuers
  • Digital payment intermediaries

Registration and Licensing Requirements

Providers must register with the OJK and meet certain conditions to obtain a license. These conditions include:

  • Compliance with data protection and consumer protection regulations
  • Adequate cybersecurity measures
  • Establishment of a complaints handling system

Electronic Money Issuers and Digital Payment System Operators

Services that meet specific criteria may be categorized as electronic money issuers or digital payment system operators. These entities must adhere to various regulations for securing a license from the OJK, such as:

  • Minimum capital requirements
  • Data protection
  • Consumer protection

Data Protection

Providers must adhere to stricter data protection requirements:

  • Secure customer data collection, processing, and storage
  • Provide transparency and control to customers regarding their data

Complaints Handling System

Providers must establish a complaints handling system:

  • Clear process for handling and resolving customer complaints
  • Mechanism for reporting serious complaints to the OJK

Consequences of Non-Compliance

Failure to adhere to these regulations may result in fines, licenses being revoked, or other sanctions imposed by the OJK.

Consulting with legal experts familiar with the local financial regulations and IT laws is crucial for businesses to ensure regulatory compliance and build trust with their customers.