OJK to Regulate Crowdfunding by Year-End
Jakarta. Indonesia's Financial Services Authority, or OJK, plans to issue a regulation on crowd funding by the end of this year in order to set up a legal base for startup business seeking to raise money from prospective customers or venture capital.
Several websites like Wujudkan.com and Patungan.net currently allow the public to back the projects or products of both individuals and companies, in the mold of global crowdfunding platform like Kickstarter, Indiegogo and RocketHub.
The websites post project proposals ̶̶ which could be social or commercial in nature ̶̶ and the funds needed to realize them, before giving netizens a certain period of time to make their investments.
Should the project raise enough money within the deadline, the crowdfunding website transfers the funds to the individual or company.
However, the scheme remains unrecognized under current financial regulations, leaving both companies and customers at risk should the website go bankrupt.
"So, we want to regulate these crowdfunding sites," said OJK chairman Muliaman D. Hadad.
Muliaman promised that the regulation would be as simple as possible as the authority would like to "open access to funding as wide as possible for startups."
OJK also plans to issue a new regulation on venture capital next week, allowing banks to set up venture capital units in order to invest in startup businesses that are otherwise unqualified for loans using conventional standards.
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