On July 4, 2022, the Financial Services Authority (OJK) has issued  a much-anticipated new regulation on P2P lending in Indonesia under OJK Regulation No. 10/POJK.05/2022 of 2022 on Information Technology-Based Co-Financing Services (POJK 10/2022) which substantially changes the regime established by OJK Regulation No. 77/POJK.01/2016 of 2016 on Technology-Based Fund-Lending Services (POJK 77/2016). POJK 10/2022 generally regulates the provisions for the Implementation of Technology-Based Collective Funding Services (LPBBTI).

LPBBTI provides financial services to connect both funders and recipients in the conduct of conventional or sharia-based funding through an electronic system using the internet. Prior to the enactment of POJK 10/2022, the Provider may establish a limited liability company or cooperatives, with a minimum paid-up capital of IDR2.5 billion. Following the enactment of POJK 10/2022, the Provider shall be in the form of a limited liability company that provides, manages, and operates LPBBTI, either conventional funding or sharia-based funding with a minimum paid-up capital of IDR25 billion.

Furthermore, foreign investors may purchase LPBBTI’s shares through transactions on the stock exchange, with investment restrictions of max. 85% shareholdings within the Provider. The provisions related to paid-up capital and foreign ownership restrictions are exclusively applicable for Providers who have yet to obtain the relevant permits following the issuance of POJK 10/2022.

In addition, the Provider is required to provide at least 1 (one) Controlling Shareholder (PSP), which is approved by the General Meeting of Shareholders or a court decision with permanent legal force.

Following the issuance of Provider’s business license issued by the OJK, the Provider shall also be registered as an Electronic System Provider in Indonesia. LPBBTI funding shall be carried out through productive funding and/or multi-purpose funding with a maximum limit of IDR2 billion,- for each recipient domiciled in Indonesia.

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