OJK has banned 144 entities engaged in peer-to-peer lending in Indonesia for failing to obtain licenses

OJK Bans These 144 Fintech Lenders for Operating Illegally


APRIL 28, 2019

Jakarta. A special task force of the Financial Services Authority, or OJK, has banned 144 entities engaged in peer-to-peer lending in Indonesia for failing to obtain licenses.

Tongam L. Tobing, chairman of the task force that monitors financial technology companies and online platforms engaged in consumer lending, said the OJK acknowledges that many operate in Indonesia illegally.

"We urge the public to be cautious and careful before choosing any fintech companies offering lending services. Choose one of the 106 companies that are registered with the OJK," he said in a statement on Sunday.

Tongam said the financial regular has identified 543 unlicensed fintech companies offering peer-to-peer lending so far this year, compared with 404 in 2018. Some of them may be in the process of obtaining licenses, while many are operating illegally.

The behavior of some fintech lenders has caused a massive outcry, as debt collectors often terrorize clients. Fintech platforms often also steal data from their clients' smartphones, including contact lists, making them prone to abuse.

Illegal Investment Services

In addition to fintech companies doing business illegally, the task force also banned 73 investment services on April 24 for operating without valid permits.

These companies were engaged in multi-level marketing, foreign exchange and cryptocurrency trading, and money market and plantation-backed investments.

This brings the number of entities that have been banned so far this year from offering investment services in the country to 120.

"We also found many offerings for illegal investment services. This is really dangerous to people's financial survival. We are calling on the public to be careful in investing their money. Don't be attracted too easily with products offering gimmicks and high returns, without looking at the investment risks," Tongam said.

He added that the task force would make a concerted effort to continue taking preventive measures, such as educating the public to help them not to fall victim to illegal investment schemes.

The list of fintech and investment services that have been banned is as follows:

Illegal fintech
Illegal fintech