Financial Services Authority Laws Against Non-Bank Financial Institutions Based on Outlaw Financial Technology

Abstract

The jurisdiction of the Financial Services Authority to oversee non-bank financial institutions operating illegally on the basis of financial technology is outlined in Article 9 of Law No. 21 of 2011 concerning the Financial Services Authority. POJK No. 10/POJK.05/2022 regulates the legal proceedings initiated by the Financial Services Authority in response to violations committed by such illegal financial technology institutions. The objective of this research was to evaluate the current regulatory structure that oversees Non-Bank Financial Institutions (NBFIs) that engage in Online Financial Trading (OFT) and to pinpoint any regulatory shortcomings or challenges faced by financial authorities in their oversight of these companies. This study employs the Statutory Approach, the Case Approach, and the Analytical & Conceptual Approach to conduct normative research. Descriptive analytical methods were employed to acquire the data, and a qualitative approach was utilised to analyse both primary and secondary data. The research findings indicate that. The Financial Services Authority lacks the authority to regulate and enforce illicit fintech. The government established an Investment Alert Task Force (SWI) comprised of twelve ministries/institutions and financial services authorities, including those tasked with overseeing online loans and other illicit financial practices, in order to combat illegal fintech. OJK educates the public about the perils of illegal fintech and implements SWI in accordance with POJK Number 10/POJK.05/2022OJK so that it is possible to take decisive action against those who harm society through illegal fintech.