The P2SK Law Is A Response To The Dynamics Of Digitalization Of The Financial Services Sector

Digitalization Illustration (Photo: Doc. Antara)

JAKARTA - The Ministry of Finance (Kemenkeu) stated that digitalization in economic activities, especially in the financial services sector, is something that cannot be avoided and sooner or later will occur.

Therefore, Deputy Minister of Finance (Wamenkeu) Suahasil Nazara said, Indonesia must make various efforts to develop the financial sector, but at the same time continue to carry out good supervision.

"This is why we issued the Law on the Development and Strengthening of the Financial Sector (UU P2SK)," he said, quoting Antara, Tuesday, May 16.

The P2SK Law is designed to respond to dynamics in the financial services industry in the form of technological innovation in the financial sector (ITSK) or commonly known as financial technology (technical/fintech).

Suahasil said that in making the P2SK Law, there were challenges in how to make the law anticipate the development and supervision of fintech in Indonesia in the future.

The reason is, the entire world's economy transits quickly towards digital and integrated, including in the financial sector.

The trend of companies in technology today leads to big tech (US tech giants), which is marked by the emergence of big-tech group conglomerates.

In Indonesia, there are 352 fintech companies recorded in 2021. This number has increased significantly from year to year, namely from 2016 which as many as 24 companies, in 2017 as many as 79 companies, in 2018 as many as 178 companies, in 2019 as many as 256 companies, and 2020 as many as 302 companies.

"This is why we are also strengthening the supervision and development of conglomerate businesses in financial services in the P2SK Law," he said.

However, to avoid the risks contained in digitalization, he said the P2SK Law helped strengthen investor and consumer protection, as well as encourage financial literacy.

This is seen comprehensively in conjunction with developments from all financial services sectors such as banking, non-banks, capital markets, financing institutions, ventures, and the carbon market which will soon be present in Indonesia.