Government has zero tolerance for illegal online lending: minister

This step should be supported by opening up access to complaints from the public. The active participation of the community in reporting this illegal act is an integral part of the management of the loan policy to be developed by the government.

Jakarta (ANTARA) – The Indonesian government will not tolerate illegal online lending given its detrimental impact on the community, Coordinating Minister for Political, Legal and Security Affairs Mahfud MD has stressed.

“Illegal money lenders are ruthless and only bring disadvantages to the victim. There is also a mutually beneficial ecosystem of this practice which only brings benefits to certain elements,” he said on Friday. in a press release.

The government, through a number of relevant ministries and non-departmental government institutions (K/L), has continued to make joint efforts to eradicate and take strong action against illegal online lending practices. that harm the community, he informed.

Harmful practices carried out by illegal online lenders include charging higher interest rates than banks, granting unsecured loans, and obtaining consent to access personal data as a precondition for loans , did he declare.

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Illegal online lending services are often misused by service providers, especially financial institutions that are not registered and supervised by the Financial Services Authority (OJK) and related associations, a he added.

The closure of the access of illegal lenders by the Ministry of Communication and Informatics is part of an administrative measure that the country can take, the minister said. This can minimize the space for illegal online lending services and also save the community, he added.

“This step must be supported by opening access to complaints from the public. The active participation of the community in the denunciation of this illegal act is an integral part of the management of the loan policy which must be developed by the government “, added Mahfud.

Meanwhile, legal lending services, which are licensed by the OJK, must receive support from various stakeholders, he said.

The government also encourages legal loan providers to follow billing rules and ethics, offer low and affordable interest rates and provide good services to the community, he said. .

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“The government will also encourage the regulation of a digital financial services industry law and the ratification of the personal data protection bill as part of an effort to protect citizens. This data protection is important for protect victims’ data which is often exploited by lenders,” the minister said.

The government will also extend protection under civil and criminal law by providing space for parties involved in disputes to resolve their cases, he said. The government will also take strong action against behavior that harms citizens, he said.

Law enforcement must be done consistently and reach out to the big money lenders, companies and actors who organize the illegal loans, he stressed.

“Law enforcement should not target junior employees only. Please consider that this illegal lending practice involves many networks, even in foreign countries,” the minister added.

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