OJK Launches "OJK Infinity", Digital Financial Innovation Center

OJK announces the operation of digital financial innovation center "OJK Infinity", a place where discussion with industries, regulators, government, academics, and innovation hub. The fintech center is located in OJK office at Wisma Mulia 2, Jakarta.

"Through OJK Infinity, the fintech industry is expected to be capable in bringing a financial service which is innovative, effective, efficient, and prioritize the consumer protection," Wimboh Santoso, OJK's Head of Commissioner, explained on Monday (8/20).

OJK Infinity has three main functions. First, providing regulatory sandbox facility as a fintech incubator to balance innovation with consumer protection. Then, as an innovation hub, for digital financial industry development (IKD) as well as a whole IKD's ecosystem development.

Lastly, as an education center for financial service players, consumers, or academics expecting to be a part of IKD as future Indonesia's economic players.

In running these three functions, OJK will collaborate for getting information and resources with many stakeholders, such as State Institutions and Ministries, all financial service industry players, associations, and universities to create a comprehensive digital financial ecosystem.

Publics can also visit OJK Infinity to get the latest information related to IKD and for IKD's associates to get further detail about its regulations.

Later, OJK Infinity will expand partnership with academic institutions or private sectors which commitment goes along with the digital financial sector development. One of which is the collaboration with Telkom University through an MoU in the scope of the research and the development of IKD's Master Program.

Applying the new regulations

In addition to the fintech center, OJK also releases the latest rules on digital financial innovation which will be the legal base to cover all innovations in the scope of the digital financial sector. POJK (OJK's regulations) was made due to the need of a legal base for innovation in the existing financial sector, therefore, it can benefit and protect public affair.

Currently, there are 63 p2p lending companies have registered in OJK with a total distribution of IDR 7.64 trillion funding by June 2018. It has been distributed to 1.09 million borrowers.

Nurhaida, Deputy Chairman of OJK's Board of Commissioners, added that this regulation applies market conduct-based supervision with OJK's regulations to control the principal base matters.

Also, monitoring regulatory sandbox activity to study, analyze, understanding risk, business model management to determine risk profiles. As well as supervision and regulatory model that goes along with the certain IKD business model.

"IKD must have a reliable system to protect customer's data. They're also obliged to monitor system independently and run risk management that meets the precautionary principle," she explained.

The POJK, following principal based concept, requires ethics code that is fully under Indonesia's Fintech Association to be further detailed.

"Unlike the regulations, it can be enforced for the implementation with legal actions. However, if the ethics code being violated, there will be a moral impact. It is what we boost to the association, and monitoring the implementation among members," he concluded.

– Original article is in Indonesian, translated by Kristin Siagian