Understanding People’s Use of Digital Lending in Indonesia 2021 | ISEAS - Yusof Ishak Institute (ISEAS) | 15 February 2021 | Webinar

As the fourth most populous country in the world, and with an internet participation ratio of more than 50%, Indonesia shows huge potential for financial technology (fintech). However, the penetration of financialisation has brought many challenges. In Indonesia, the increase of household debt is partly supported by the rapid growth of information technology-based lending. For some people, the easier access to credit that is offered might be one opportunity, however, it raises new risks as well, such as being burdened by debt or worsening their financial condition, especially if they choose an unsecured loan. Government policies have become very important as a result. Strengthening regulation in the financial services sector is very important to reduce the complexity and fraud. Alongside with this, living in a more financialised world means that we need a better understanding of finance. Financial capability plays an important role because it supports a greater understanding of financial management and protects people from fraud and unnecessary financial risks. Given that over-indebtedness could risk the country into financial vulnerability, this presentation will discuss a range of relevant issues related to the use of fintech and financial capability in Indonesia, with the focuses on household debt sourced from online loans, it will also highlight the efforts and regulation of financial services made by the government in ensuring good market conduct and enhancing consumer protection.

2021 Speaker

Dr. Johan Irni Rahmayan
Assistant Professor, Department of Family and Consumer Sciences, IPB University, Indonesia