Detection of fintech P2P lending issues in Indonesia

Abstract

Financial technology (fintech) is a growing industry in Indonesia, supported by advances in the technological infrastructure. At the end of 2019, the Financial Services Authority (OJK), the financial authority in Indonesia, recorded 164 registered and licensed fintech (P2P lending) companies. However, since early 2018, the Investment Alert Task Force (SWI) and the Ministry of Communication and Information Technology have blocked 1,350 illegal fintech platforms. Illegal fintech lending practices have mechanisms beyond the responsibility and authority of the OJK, including the risk of collection and distribution of personal data. The essence of this study is to discuss the landscape of fintech P2P lending in Indonesia from Indonesian Online News data, explore cases of fintech p2p lending in Indonesia, and understand the rules and policies. Qualitative research with a case study approach and Focus Group Discussion techniques were used to obtain data from 4 stakeholders in the Fintech P2P Lending Industry in Indonesia. VOS Viewer software is used to build keywords from Indonesian Online News collections, NVIVO 12 qualitative software is used to assist data analysis. The research found the keyword clusters most frequently discussed in the Indonesian Online News collection and five case themes such as public awareness about P2P lending (user understanding), data leakage, and restriction of data access, including personal data protection, personal data fraud, illegal fintech lending, and Product marketing ethics.

Analysis of Snare of Law for “Pay Day Loan” Providers According to Indonesian Criminal Law

“…The results of the OJK search and the Investment Alert Task Force since early 2018 until now, the Investment Alert Task Force (SWI) and Kemenkominfo (the Ministry of Communication and Information Technology, also known as the Ministry of ICT) have blocked 1,350 illegal fintech plat-forms (OJK, 2019a). Nearly ten times as many fintech platforms attempt to operate outside regulations as operate legally in Indonesia [5]. Base on available data show that 42 percent of entities (Illegal Fintech) are of unknown origin.…”

“…Likewise, there are financial management services that can be done online, and now many people are talking about booming [4]. Lee & Shin cited by Ryan Randi Suryono argue that Fintech is recognized as one of the most important innovations in the financial industry and is growing rapidly, driven in part by the sharing economy, regulation, and information technology [5]. Based on Information Technology Services released on December 28, 2016, the number of P2P landing companies that are registered or have permits and register their companies reach 40 entities, of course every year it can increase [6] There are actually many researches on the topic of Fintech, Christian Hadad researching the Global Fintech Market [7], Hornuf and Hadad researching Fintech Transformation in Germany [8], Ryan Randi Suryono researching the challenges and trends of fintech [9] and Helen researched fintech related to financial access [10].…”

Influence of trust and risk on peer-to-peer investment willingness: a bidirectional perspective

“…The foundation of the global P2P lending market is the sustainable and stable operation of P2P platforms (Tong et al , 2019). In many countries, such as Indonesia in Asia, Latvia in Europe and Mexico in Latin America, the P2P lending market is developing rapidly while a lot of problematic P2P platforms have emerged (Berkmen et al , 2019; Canfield, 2018; Petersone and Kreituss, 2020; Suryono et al , 2021). The failure of P2P platforms could have serious consequences for these immature P2P lending markets (Ziegler et al , 2021).…”

“…The current issue and full text archive of this journal is available on Emerald Insight at: https://www.emerald.com/insight/1066-2243.htm a lot of problematic platforms have appeared in China's P2P lending market, which exposes the assets of lenders to risks (Huang, 2018). Similarly, P2P lending in other countries also suffers from the collapse of P2P platforms (Suryono et al, 2021). However, plenty of P2P platforms keep good operation status since their launches, which is critical to the long-term development of P2P lending.…”

Insights into financial technology (FinTech): a bibliometric and visual study

“…The FinTech ecosystem consisting of FinTech startups, technology developers, government, financial customers, and traditional financial institutions was presented by Lee and Shin ( 2018 ). Accordingly, the application of FinTech has been involved in many areas, such as mobile payment (Gomber et al 2018 ), mobile networks (Gai et al 2016 ; Wen et al 2013 ; Zhang et al 2013 ; Zhang and Soong 2004 ), big data (Yin and Gai 2015 ), blockchain (Wamba et al 2020 ; Iman 2018 ), P2P lending (Gomber et al 2018 ; Ge et al 2017 ; Suryono et al 2021 ; Wang et al 2020a , b ), cloud computing (Castiglione et al 2015 ; Gai et al 2018a , b ), banking service, investment funds, retail groups, and telecom operators (Singh et al 2020 ), image processing (Castiglione et al 2007 ), and data analysis techniques (Qiu et al 2015 ).…”