Problems and Effectiveness of Illegal Online Lending Supervision Policies in Indonesia from an Economic Policy Law Perspective (Maliki Interdisciplinary Journal)
Summary
- During the period from February to March 2024, Satgas PASTI identified 537 illegal online lending entities operating through unofficial websites and mobile applications.p.5
- Throughout 2024, Otoritas Jasa Keuangan (OJK) stopped or blocked 2,930 illegal online lending platforms out of a total of 16,231 complaints received.p.5
- In February and March 2024, Satgas PASTI blocked 195 debt collector contact numbers reported for engaging in intimidating collection practices.p.5
- The Indonesia Anti-Scam Centre (IASC), formed in November 2024, received 2,257 reports with total reported financial losses of Rp700,2 billion up to February 2025.p.5
Key insights
- Illegal online lending platforms rapidly adapt to blocking measures by launching new applications in very short timeframes.p.2
- Low digital literacy makes vulnerable groups, including university students, highly susceptible to illegal loans with unverified legal status and excessive interest rates.p.3
- Overseas server locations present technical and jurisdictional hurdles that severely limit domestic police enforcement and legal asset recovery.p.4
- Illegal platforms frequently misuse sensitive personal data such as contact lists, photos, and biometrics to threaten and intimidate borrowers during debt collection.p.4
- Enforcement remains weak because administrative oversight authority belongs to OJK while criminal prosecution powers reside with the police.p.5
- A 'hydra phenomenon' exists in digital lending enforcement, where each blocked platform is quickly replaced by multiple new entities using different identities.p.5
- Application of legal effectiveness theory shows supervision fails due to deficits in technical tools, enforcement coordination, and societal financial habits.p.6
- Harmonizing fragmented regulatory regimes across banking, consumer protection, personal data privacy, and cyber law is critical for sustainable oversight.p.8
Topics and entities
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