Will more regulation help or hurt Indonesia’s online lenders?

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Hello there,

Ever see a seemingly simple business idea and think: “Even I could do that.”

It seems that’s a common thought among entrepreneurs, given the way some industries mushroom – until regulation tightens, at least.

While businesses and free-market advocates may dismiss rules as a wet blanket to innovation, regulators may have good reason to step in when an industry poses a direct risk to the public.

This week, my colleague, Budi, examines how Indonesia’s Financial Services Authority is hitting the brakes on the growth of online lenders with new regulations aimed at weeding out unsafe practices and improving transparency on lenders.

In this week’s Hot Take, I write about Indonesia’s plan to issue a digital rupiah. While central bank digital currencies have so far been controlled by central banks themselves, regulators are taking differing stands on how involved they want to be, and why involving private entities could even be preferable.

– Qishin

THE BIG STORY

Indonesia’s OJK launches more stringent regulations for online lenders

Image credit: Timmy Loen

The POJK 10 regulation requires new online lenders to have US$1.6 million in paid-up capital – 10x higher than the amount in the old POJK 77 rule.

THE HOT TAKE

Indonesia’s case for a digital rupiah

Photo credit: JasonParis

NEWS YOU SHOULD KNOW

FYI