Currently Indonesian millennials are highly engaged with social programs or social campaigns. It may be quite hard obtaining loans from Indonesian banks to finance a social project, considering its nature and strict procedure. Following the issuance of the recent BI Regulations on Fintech near the end of 2017, it indicates that the regulator is starting to allow the growth of financial technology in crowd funding through some assessment and certain procedures (as explained in “Legal affair” section).
Under the BI Regulations on Fintech, any financial technology operator that fulfills the category as “Financial Technology” shall be required to have itself registered to BI pursuant to BI Regulations on Financial Technology. The activity of financial technology operator includes, among others loan, financing and capital provision. Furthermore it was mentioned under BI Regulations on Fintech the example of financial technology in the form of loan, financing and capital provision shall be peer-to-peer lending and crowd funding.
Considering that the fintech that conducts crowd funding activity in this section may be fit with the examples provided in the BI Regulations on Fintech, then such business player need to firstly register to BI as financial technology operator and follow the determined procedures i.e. registration, Regulatory Sandbox and licensing.
Please see detailed explanation on Part “1. Payment Service / Mobile Payment”, particularly on “Legal Affairs” part.
In general, the market for crowdfunding services is relatively high, considering the number of Indonesian people has reached more than 250 million people and the high awareness of campaign and social movements in some big cities in Indonesia.
Many crowdfunding companies are emerging in the market, such as: