URGENCY OF SHADOW BANKING REGULATION FOR FINANCIAL TECHNOLOGY LOAN LOAN SERVICE BASED IN INDONESIA

Abstract

Shadow banking is a shadow bank, where an institution is not a bank but runs activities like a bank, namely collecting and distributing funds to the public. This study aims to analyze and determine the development of shadow banking in financial technologybased loan services in Indonesia and the urgency of establishing regulations. The research method, namely normative legal research with the legislation approach and conceptual approach. Legal materials are analyzed using legal construction methods and then described. The development of shadow banking in financial technology-based loan services in Indonesia is categorized into two, namely Financial Technology-Based Lending and Borrowing Services that have been licensed and registered by the Financial Services Authority and illegal financial technology-based loan services. Problems and risks stem from illegal activities. The Investment Alert Task Force and the National Consumer Protection Agency in collaboration with the Ministry of Communication and Information have the authority to crack down on loans and services based on illegal financial technology. The urgency of establishing shadow banking regulations on financial technology-based lending and borrowing services in Indonesia is based on three aspects, namely philosophical aspects based on Article 33 of the 1945 Constitution, sociological aspects based on risk and impact of victims and juridical aspects based on the absence of written sanctions in both regulations has been issued through the Financial Services Authority Regulation.