Financial Inclusion, P2P Lending, and MSMEs

In Indonesia after the Asian financial crisis of 1997–1998, wide reforms were carried out, and “inclusive” economic development were adopted. One component of inclusive economic development is “financial inclusion.” This implies an absence of barriers that might deter micro, small, and medium enterprises (MSMEs) from obtaining financial services. However, the portion of bank credit received by MSMEs is still small. Therefore, financial technology (FinTech) is welcome as an alternative source of funding for MSMEs. This chapter discusses three related issues, namely financial inclusion, MSMEs, and P2P lending. It concludes that Indonesia still has a long way to go to achieve full financial inclusion. This chapter suggests that with the presence of P2P lending, the number of MSMEs, especially MSEs, in Indonesia that have access to formal financing will increase. Even though aggregate data are not available, the interviews with a small number of owners of MSEs who received P2P loans suggest that the presence of P2P lending companies give some benefits for MSEs.

Financial Technology Regulation in Malaysia and Indonesia: A Comparative Study

Introduction to The Problem: The era of innovation in information technology has emerged to ease daily commercial transactions. The innovation in financial technology has created numerous new business model to cater the customers’ need. This development needs a regulation and supervision to avoid chaos in the financial system. Particularly in Indonesia and Malaysia, which both countries were recorded by CCAF to be among the top countries in the ASEAN region by the number of fintech firms.Purpose/Objective Study: This study is aimed to analyze the financial technology regulation and supervision in Indonesia and Malaysia.Design/Methodology/Approach: The comparative study is conducted to compare the regulatory environment related to Digital payment, Equity Crowdfunding, P2P lending, Crypto Asset, Consumer protection, cybersecurity law and Islamic fintech in both countriesFindings: The study found that compared to Malaysia, Indonesia has lack of jurisdiction that protecting the customer from the cyber-attack which highly threatening the fintech industry. Both countries also treat ICO differently. Malaysia treats it under RMO guidelines, while Indonesia banned it as the method of payment but still allows the trading of ICO as a commodity under Commodity Futures Regulatory Agency.

Information Asymmetry Among Investors and Strategic Bidding in Peer-to-Peer Lending

Peer-to-peer (P2P) lending became a global phenomenon in recent years. Despite their prominence in the “FinTech” era, P2P platforms remain a risky investment because of the high default rate of unsecured personal loans funded on such platforms. In contrast, the rate of return can be much higher than that of other investments if P2P loans are repaid. Therefore, investors of P2P loans need information about borrowers’ ability to repay. An important channel is to learn from other investors who may have information advantages. We argue that, because collective effort from investors is required in P2P lending, it could be optimal for informed investors to bid early in projects with the purpose of signaling the quality. With a unique data set from Prosper.com, we find that informed investors are indeed more likely to bid in the early stage of a project with a low probability of being funded, whereas uninformed investors will follow. The “squatting” behavior (early bidding) of informed investors facilitates information spillover to uninformed investors, benefitting the investors and borrowers who otherwise may not raise sufficient funding. Our findings also have implications for P2P lending platforms on how to manage the information asymmetry and strategic behaviors of investors.

Adverse Selection in P2P Lending: Does Peer Screening Work Efficiently?—Empirical Evidence from a P2P Platform

The rapid development of online lending in the past decade, while providing convenience and efficiency, also generates large hidden credit risk for the financial system. Will removing financial intermediaries really provide more efficiency to the lending market? This paper used a large dataset with 251,887 loan listings from a pioneer P2P lending platform to investigate the efficiency of the credit-screening mechanism on the P2P lending platform. Our results showed the existence of a TYPE II error in the investors’ decision-making process, which indicated that the investors were predisposed to making inaccurate diagnoses of signals, and gravitated to borrowers with low creditworthiness while inadvertently screening out their counterparts with high creditworthiness. Due to the growing size of the fintech industry, this may pose a systematic risk to the financial system, necessitating regulators’ close attention. Since, investors can better diagnose soft signals, an effective and transparent enlargement of socially related soft information together with a comprehensive and independent credit bureau could mitigate adverse selection in a disintermediation environment.

Peran Platform Peer To Peer Lending Atas Tanggung Jawab Pembebanan Jaminan Hak Cipta Berdasarkan Hukum Positif Di Indonesia

Kemajuan teknologi informasi dan komunikasi yang pesat, telah menyebabkan masyarakat berkembang dalam segi pola pikir ataupun kreatifitas yang mendorong lahirnya kekayaan intelektual terutama hak cipta, perkembangan lahirnya hak cipta perlu juga diikuti oleh pelindungan hukum yang komprehensif melalui peraturan perundang-undangan, perlunya pelindungan hukum tersebut adalah untuk melindungi hak cipta yang memiliki nilai besar dalam memajukan perekonomian di Indonesia, selain perkembangan masyarakat, Lembaga jasa keuangan juga berinovasi kearah digital, kini Lembaga jasa keuangan non-bank memiliki produk digital yaitu platform P2P lending. Dalam permohonan pinjaman pada platform P2P lending dapat dilakukan pembebanan objek jaminan, dengan tingginya perkembangan dan berharganya hak cipta, oleh karena itu hak cipta dapat dijadikan objek jaminan dalam melakukan pinjaman pada platform P2P lending melalui jaminan fidusia. Dalam penelitian ini digunakan metode pendekatan yuridis normatif, yaitu dengan menelusuri dan menjelaskan substansi dalam suatu peraturan perundang-undangan yang berlaku. Penelitian ini menunjukkan bahwa, pertama belum adanya pelindungan hak cipta sebagai objek jaminan fidusia dalam platform P2P lending secara khusus dalam Undang-Undang Hak Cipta ataupun POJK 77/2016, kedua, Undang-Undang Informasi dan Transaksi Elektronik tidak mencakup peran dan pertanggungjawaban penyelenggara apabila terjadi wanprestasi yang menyebabkan kerugian bagi lender sebagai pemberi kuasa. Oleh karena itu diperlukan peraturan yang mengatur terkait pembebanan hak cipta sebagai objek jaminan fidusia pada platform P2P lending dan juga peran penyelenggara sebagai penerima kuasa dari lender dalam mengembalikan pituang yang dimiliki lender, serta pelaksanaan penggunaan objek jaminan kebendaan dalam permohonan pinjaman pada platform P2P lending di Indonesia.

Urgensi Penegakan Hukum Pidana pada Penerima Pinjaman Kegiatan Peer To Peer Lending Fintech Ilegal dan Perlindungan Data Pribadi

Kegiatan peer to peer lending di Indonesia sangat pesat ketika covid 19, hampir segala kegiatan di alihkan menjadi serba online atau digital, yang mana tidak menutup kemungkinan seperti meminjam uang secara online/dalam jaringan. Hal tersebut, memungkinkan adanya tindak kejahatan baru seperti membuat platform P2P lending tanpa izin Otoritas Jasa Keuangan (OJK)/pihak berwenang atau dapat juga disebut ilegal. Banyak masyarakat yang menjadi korban P2P lending ilegal ini dan terlilit hutang dengan bunga yang sangat besar. Penegakan hukum terhadap pembasmian tindak pidana ini masih sangat minim atau belum terlaksana dengan maksimal. Walaupun banyak pasal yang sudah mengakomodir kejahatan itu, tetapi faktanya baru terdapat 2 putusan pidana terkait penyelesaian kasus ini. Penelitian hukm ini bersifat normatif dengan mengumpulkan data serta studi dokumen atau literatur dalam jaringan. Terdapat hasil penelitian yang mana platform P2P lending ilegal setiap tahun meningkat di Indonesia, yang mana tidak secara resmi terdaftar dalam OJK. Penegakan hukum yang digunakan adalah dengan menekankan pada ancaman kekerasan atau menakut-nakuti yang ditujukan secara pribadi / pasal 45 (4) jo pasal 27 (4) UU RI No. 19 2016 tentang perubahan atas UU No 11 Tahun 2008 tentang ITE, sedangkan perlindungan data pribadi belum menjadi hal yang di lindungi oleh UU/Negara.

The Impact of Peer-to-Peer (P2P) Lending on Business Development of Small and Medium-Sized Enterprises

The problem faced by most micro-entrepreneurs in Indonesia is financing business. Peer-to-peer (P2P) lending is a non-bank financial institution that can be an alternative source of financing because of the requirements and easy application usage. This study aims to analyze the impact of peer-to-peer lending on business expenses, business turnover, total employment, total sales of products, and profits before and after obtaining a peer-to-peer lending loan and analyze factors affecting the increase in business turnover after getting a loan through peer-to-peer lending. The methods used in this study include the descriptive analysis method, paired t-test, and ordinary least square (OLS). The paired t-test results indicate that there is a significant difference between business expenses, business turnover, the amount of labor, the number of product sales, and profit before and after obtaining a peer-to-peer lending loan. The result of analysis with the OLS method shows that the length of business and expenditure of the business has a significant effect on the development of respondents' business turnover.