Depok-Online loans became known to the Indonesian public around 2016. The emergence of digital financial institutions, especially online loans, really helps people to get access to finance more easily. At that time, online loans were more often used by Micro, Small and Medium Enterprises (MSMEs) who needed financial support for their business, without having to submit collateral or collateral.
Before becoming familiar with online loans, people were first introduced to the term financial technology (fintech), namely a type of financial service with technology as its operational basis. When referring to the Financial Services Authority (OJK), fintech is an innovation in the financial services industry that utilizes the use of technology.
In Indonesia, there are several types of fintech companies ranging from crowdfunding, microfinancing, digital payment systems, peer to peer (P2P) lending and also aggregators. P2P lending is a money lending service. In 2018, OJK announced that it had found at least 227 P2P lending startup companies that were not registered with OJK. In 2019, the OJK noted that there were 127 online loans registered and supervised by the OJK, and 1477 illegal online loans. OJK urges P2P lending startup or online loans to register and obtain permits from the OJK.
Online loans, who initially appeared as a savior god, has recently been exposed to negative news more often because many victims have started to get into debt. The number of online loan application companies is mushrooming in society, there are also online loan applications that are illegal or do not have permission from the OJK. Coupled with this is the lack of a strong legal protection, which makes these online loan services tend to operate in a negative direction.
Indonesian Ministry of Communication and Information Technology data reveals that during 2019-2021, the OJK recorded more than 19,000 public complaints regarding illegal online loans. The data is divided into 47% of serious violations and the rest are classified as mild/moderate violations. DKI Jakarta is the province with the highest borrowers, followed by West Java.
This phenomenon was conveyed by Karin Amelia Safitri, S.Pd., M.Si., lecturer in the Insurance and Actuarial Administration study program, Vocational Education Program, Universitas Indonesia (UI) while carrying out community service activities in the Thousand Islands Administrative Regency, especially in Panggang Island Village, on August 19, 2023.
(Photo: Financial literacy for the people of Panggang Island)
Community service with the theme “Beware of Illegal Online Loans” chaired by Karin, consists of three lecturers and two students. The community service activities which were carried out in one day were aimed at the people of Panggang Island Village, which has a population of 2,289 people. It turns out that some of the residents on the island covering an area of 0.09 km2 are entangled in online loans, so it is necessary to look for solutions and knowledge so that they remain alert to online loans.
They are educated that if they have ever been involved with illegal online loans, then the solution is to make a complaint to the OJK. Then, for other people who have never dealt with illegal online loans, they receive education from the UI Vocational team who dissect the characteristics of illegal online loans. Karin believes, “Several characteristics of illegal borrowing include very high loan interest, rough billing of loan recipients, loan repayment due dates that do not comply with the initial agreement, not having permission from the OJK, and asking for access to data personal.”
It is hoped that the implementation of these community service activities will have a positive impact on participants, so that they become more alert and intelligent in detecting and understanding the dangers of illegal online loans. Suryani (45), a housewife on Panggang Island, stated that the socialization regarding the dangers of illegal online loans gave her new insight. She said, “This socialization has made us more self-aware of suspicious online loans, so we are not stuck with online loans that are not registered with the OJK.”
Padang Wicaksono, S.E., Ph.D, Director of the UI Vocational Education Program, supported the community service program that was carried out on Panggang Island. According to him, the illegal onlin loans that are currently appearing in various advertisements can endanger people who do not have enough knowledge about the risks behind them. “I hope that the people of Panggang Island can receive as many benefits as possible from the community service program provided by UI Vocational lecturers,” said Padang.
