Fintech Association Inaugurates Code of Conduct, Contains Three Pillars of Consumer Protection

The Indonesian Fintech Association (Aftech) has finally released the Code of Conduct for Responsible Information Technology-Based Lending and Borrowing Services (LPMUBTI) (Code of Conduct for Responsible Lending). This guideline also confirms the commitment of business actors in implementing responsible business practice standards to protect customers.

There are three references that became the basic principles in developing the guideline. First, product transparency and bidding methods. The Operator is required to include all costs arising from debt, including costs incurred in advance, interest, late fees, and others.

This method has proven to be able to empower consumers to accept debt responsibly and can minimize the risk of fraud and unethical practices. Transparency also means disclosure of information by the organizers so that business actors are also required to include addresses, emails, and telephone numbers for customer complaints.

Second, prevention of excessive borrowing. Debt offering aims to increase the ability and economic resilience of consumers and not to plunge into debt bondage. Operators are prohibited from providing loans directly to borrowers without prior approval, conducting adequate research and verification, and are prohibited from manipulating consumer data.

Third, the principle of good faith related to the humane practice of offering, giving, and collecting forests without physical and non-physical violence, including: cyber bullying. Operators are prohibited from using third party billing implementers who have a bad reputation based on information from the authorities or associations.

LPMUBTI is the result of collaboration with the Aftech Financial Inclusion Working Group which contains a set of principles and processes that are mutually agreed upon and voluntarily by Aftech member companies that provide online lending and borrowing services.

Also joined as members of the working group from the organizers or platforms for buying and selling goods with installment services, pawning, comparison platforms, and finance and banks.

"It is a matter of pride for Aftech that today more and more fintech industry leaders are proactively taking decisive and concrete steps in building a better and sustainable industry. These guidelines can bind all member businesses who offer and/or provide online loans to comply and play according to rules," said Deputy Chairman of Aftech Adrian Gunadi, Thursday (23/8).

According to Adrian, the guidelines have been signed by more than 43 Aftech members. It is expected that 64 fintech companies that have been registered with OJK can also sign LPMUBTI this month. Before being announced to the public, this code of conduct had the full support of the OJK.

Load five prohibitions when billing

Not only adheres to the three pillars of consumer protection, the guidelines also contain five prohibitions when collecting debts that must be obeyed by the organizers. First, the organizers are prohibited from charging with disrespectful words. Second, billing provocatively, aggressively, insultingly, intimidatingly, and the like against borrowers and related parties.

Third, disseminate information related to the borrower's personal data. Fourth, claiming to be another person or law enforcement party. Finally, the return of loan collection outside the initial agreement.

"Of the five prohibitions, it can be lowered in more technical detail. We are currently discussing it," explained Head of Aftech Cash Loan Loans, Sunu Widyatmoko, quoted from Dataword.

To further reduce the negative possibility, Aftech is also reviewing the certification policy for debt collectors. This is so that debt collectors understand the applicable code of conduct and collect according to the provisions.

"Don't let any players blame someone and really find out who is responsible."

On the same occasion, Aftech also announced the official appointment of three members of the Independent Ethics Committee, namely Andre Rahadian, Maria Sagrado, and Abadi Tinsnadisastra as supervisors to oversee the implementation of the Aftech initiative.

Also joining is Rachmat Waluyanto (former Deputy Chairman of the OJK Board of Commissioners) as the Aftech Advisory Board with M Chatib Basri, Mahendra Siregar, and Budi Rahardjo.