The Indonesian Financial Services Authority, known as OJK, has shuttered a staggering 826 fintech startups operating without a license in this year alone, despite the increased appetite for the industry in the Southeast Asian nation.
National Police spokesman Dedi Prasetyo reveals that the illegal fintech companies charged inflated fees and resorted to criminal and unethical recovery practices, which in turn has led to customers being threatened and persecuted.
Prasetyo states that the public should not have to endure this treatment at the hands of these fintech startups, especially after falling prey to the allure of easy loans, and must not share personal data with companies operating without licenses.
Chief of investment watchdog at OJK Tongam L. Tobing has asked the police and public to help track other illegal firms operating across websites, mobile apps and social media, where these firms may prove to be difficult to spot.
Tobing says: “What makes the fintech firms thrive is because the society is still easily tempted by offers of loans with less hassles.” He goes on to explain that the origin of 42% of the 1,230 shuttered fintech firms is still not known, but 22% had servers in Indonesia and 15% in the US.