SUMMARY OF OJK REGULATION NO.77/POJK.

01/2016 Regarding Technology Based

Fund Lending Services

I. LEGAL BASIS
In the digital economic development era, the public keeps developing innovations in lending
services, one of which is characterized by the provision of Information Technology-Based Money
Lending Services that contributes to the national development and economics. Information
Technology-Based Money Lending Services largely accommodate the public with further access
to online financial services together with various parties without knowing one another
The main advantages of Information Technology-Based Money Lending Services are, online
availability of electronic agreeement documents for the needs of the parties, legal attorneys in
place for ease of online transactions, online risk assessment of parties, online billing, information
on parties loan status provided online, and availability of parties banking ecrow account and virtual
account, with which the whole fund payments can be conducted throughout the banking system.
In addition, Information Technology-Based Money Lending Services are expected to become one
of the solutions for assisting micro-,small,medium scale business operators (UMKM) to have
access to the funding.

In conducting this review, I have reviewed the relevant, applicable and/or prevailing laws,
legislations, regulations and judicial decisions, as follow:

Law and Regulations

A. OJK Regulation No.77/POJK.01/2016 regarding Technology Based Fund Lending

Services (“POJK 77/2016”)
B. Law Number 21 of 2011 concerning The Financial Service Authority

II. LEGAL ANALYSIS

This Peer to Peer Lending scheme involves three principal parties:

(i) Providers, which are Indonesian legal entities which obtain funds from lenders and pass
them on to borrowers
(ii) Borrowers, which are Indonesian citizens or legal entities
(iii) Lenders, which are Indonesian and/or, foreign citizens and/or entities, as well as
international organizations.
These are the obligations of the providers:
 A providers shall be certified as Other Financial Services Institution, and shall be in the
form of a limited liability company or a cooperative (services cooperative only).
 The providers may be formed and owned by an Indonesian citizen and/or an Indonesian
legal entity and/or a foreign citizen and/or a foreign legal entity. Alongside, share
ownership in a provider by a foreign citizen and/or a foreign legal entity either directly or
indirectly shall not exceed 85%.
 The providers must have a paid-up capital of at least Rp. 1.000.000.000 and at the time of
applying at least Rp. 2.500.000.000.
 The providers must file an application for registration and licensing with the OJK.
 The providers are required to meet the maximum limit of total lending of funds to each
debtor in the amount Rp. 2.000.000.000.
 The providers must provide a virtual account for creditors to send the money to. The
providers must also provide an escrow account to which the borrower must send back the
funds to repay their loans.
 The providers are also required to submit a periodic report once every 3 months for the
period ending March 31, June 30 September 30, and December 31 o the OJK prepare
Monthly reports. These must be submitted to the OJK within 10 working days of the
reporting due date.
 Administrative sanctions for violation of obligations in POJK 77/2016:
1. Written warnings;
2. Penalty;
3. Restriction on business activities;
4. Revocation of permission.