OJK Prepares Draft Circular on Soundness Level Assessments of P2P Lending Organizers: Five Assessment Factors Further Detailed

In 2024, the Financial Services Authority (Otoritas Jasa Keuangan– “ OJK ”) established a framework for the organization of Information Technology-Based Joint Funding Services (Layanan Pendanaan Bersama Berbasis Teknologi Informasi/LPBBTI), which are commonly known as the Peer-to-Peer (“ P2P ”) lending services, through the issuance of Regulation No. 40 of 2024 (“ Regulation 40/2024 ”). [1] Among the various provisions set out therein, Regulation 40/2024 requires organizers of said P2P lending services (“ Organizers ”) to comply with certain soundness level requirements, ultimately achieving a minimum composite rating of 3 (i.e. fairly sound, indicating ability to withstand significant adverse changes in business conditions and other external factors). [2] These composite ratings are determined based on a comprehensive and structured analysis of the following factors: [3]