Otoritas Jasa Keuangan (OJK), a government agency, which regulates and supervises the financial services sector, has finally issued a regulation on fintech firms that run peer-to-peer lending businesses in Indonesia.
The new regulation, POJK No. 77/2016, announced toward the end of December, is seen as an introductory move by the OJK to oversee the fintech industry, so as to ensure a smooth regulatory oversight over the nascent but burgeoning sector.
The draft regulation proposed that a fintech company is required to have Rp 2 billion (approximately $150,000) in working capital when registering its business with the OJK. The final regulation has halved that requirement, to Rp 1 billion. Further, fintech companies will be required to show Rp 2.5 billion when applying for a business license, after its registration phase. That’s down from Rp 5 billion, stated in the draft regulation.
To foster development of fintech services under its watchful eye, the OJK has also introduced and established a regulatory sandbox. Firms will be encouraged to test services and offerings meant for consumers under the authority’s supervision.