Friday, April 19, 2024

OJK plans summit with Google and Meta to tackle illegal online lending

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Indonesia’s Financial Services Authority (OJK) intends to engage Google and Meta, Instagram’s parent company, in discussions to combat illegal online lending activities.

“We urge Google and Meta not to display ads for illegal online lending in their applications,” Friderica Widyasari Dewi, Executive Head of Financial Service Business Actors’ Behavior Supervision, Education, and Consumer Protection at OJK.

The collaboration aims to eliminate the promotion of illegal online lending through popular platforms such as Google Search, YouTube, Instagram, Facebook, WhatsApp, Messenger, and Threads.

Efforts to eradicate illegal online lending face challenges, with approximately 7,000 illegal online lending platforms. Having been blocked, yet new ones continue to emerge. 

Despite the efforts of the Task Force for the Eradication of Illegal Financial Activities (Satgas PAKI) in blocking websites, applications, content, features, bank accounts, and WhatsApp numbers associated with illegal online lending, the issue persists.

Under the Development and Strengthening of the Financial Sector Law (UU P2SK), OJK has increased sanctions against illegal online lending businesses. 

Offenders may face up to 12 years in prison and fines of up to IDR 1 trillion. OJK plans to reinforce its collaboration with Meta and Google to address this issue and will also involve the Ministry of Communication and Information.

OJK is eagerly awaiting the release of government regulations derived from UU P2SK. The regulations are expected to provide a more assertive approach in curbing illegal online lending, particularly those that advertise inappropriate content. 

Sarjito, an OJK representative, emphasized the need for an affirmative stance to suppress illegal online lending practices.

As of early November 2023, Satgas PAKI successfully halted the operational activities of 1,641 illegal financial entities, comprising 18 illegal investments and 1,623 illegal online lending platforms. 

OJK received 9,380 complaints related to illegal financial entities, encompassing 8,991 cases of illegal online lending and 388 instances of illegal investments.

The collaborative efforts with major tech companies are anticipated to strengthen the fight against illegal online lending in Indonesia.

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