Gov’t to Combat Illegal Online Lending

Head of OJK Board of Commissioners, Minister of Communications and Informatics Johnny G. Plate, and Minister of Agrarian Affairs and Spatial Planning/National Land Agency Sofyan Djalil at the Presidential Palace in Jakarta, Friday (15/10). (Photo by: PR of Cabinet Secretariat/Jay)

The Government has announced it is taking steps to eradicate and take actions against illegal online lending activities that can disadvantage the people.

“Along with Chief of the Indonesian National Police (Polri), Ministry of Communications and Informatics, Governor of central bank Bank Indonesia, and Minister of Cooperatives and MSMEs, we have a joint decree, a joint agreement to eradicate all illegal online lending [companies],” Head of the Board of Commissioners of the Financial Services Authority (OJK) Wimboh Santoso said in his press statement after attending a meeting led by President Joko “Jokowi” Widodo at Jakarta Presidential Palace, Friday (15/10).

According to Wimboh, the measures are aimed at eradicating illegal online loan providers and giving them a deterrent effect.

“We must shut down the platforms and legal actions must be taken regardless of the form, be it cooperative, payment, or peer-to-peer lending. All of them are the same. This immediate and massive eradication is our joint agenda, specifically the OJK, the Chief of the Polri, and Minister of Communications and Informatics’,” he said.

Wimboh pointed out that there are currently 107 online lending companies that have been registered and granted license by the OJK and all online loan providers must be a member of fintech association.

“The association works on how to push providers to be more effective in providing cheap and fast loan that does not cause collection excesses that violate rules and ethics. There is an agreement that has already been made by all providers and facilitated by the association,” he said, adding that online lending companies must also bring benefit by providing loan to many people swiftly.

“For those that have been registered, we continue to push them to give better services, to provide lower interests and an improved collection so as to not cause excesses on the ground,” he said.

Wimboh underscored that the management of online lending will be jointly carried out with related ministries and institutions.

“So, we will take more massive actions to eradicate [illegal online lending companies] and improve effectivity and services of online loan providers that have been registered with the OJK,” he remarked. (DND/UN) (DH/EP)