The Types and Legal Basis of Fintech

The digital era presents many conveniences and solutions to every society’s problem related to the financial world. One of which is the fintech (financial technology) industry.

The presence of fintech is also often associated with startups, newly built companies that primarily target the recent generations as talents and clients. The companies are now closely related to an industry that relies heavily on technology to run its business.

There are many fintech companies of different types in Indonesia. On this occasion, we will discuss what fintech is and its types comprehensively. Read more!

What is Fintech?

Two types of startups in Indonesia are experiencing rapid development: e-commerce and Financial Technology (Fintech). As we know, e-commerce is a company that provides an online buying and selling platform. While fintech, quoted from the page, ojk.go.id, is a company that innovates in the financial services field with a touch of modern technology.

So how are these companies benefit society? There are many, one of which is the alternative investment and many practical breakthroughs in the financial system.

The existence of financial technology itself affects people’s lifestyles. Combining practical, efficient, and convenient financial services with economic effectiveness positively impacts society. Hence, many companies grow relatively fast in Indonesia and other countries.

With the existence of fintech, payment methods can be more accessible, and investing is now as easy as moving a finger. Here are some of the benefits of fintech that the community can feel:

  • Expanding employment
  • Increase economic growth
  • Improving the macroeconomy
  • Decrease in loan interest

Also Read: Definition and Examples of Non-Bank Financial Institutions in Indonesia

Types of Fintech

There are at least 5 types of financial technology in Indonesia, namely:

1. Crowdfunding

It is a financial technology model that raises funds as an initiative to do good in social programs. An example is Kitabisa.com.

2. Micro Financing

What is fintech Micro Financing? It’s a financial service for the lower middle class to access more funds to develop their businesses.

3. Peer-to-Peer Lending

The service provided by this type of fintech is the provision of financial loans with more accessible terms. Loans can be disbursed quickly and can be accessed through the application.

4. Payment Gateway

Payment Gateway is a fintech company that works by authorizing payments through online transactions.

5. E-Wallet

An E-Wallet is a digital wallet that provides a place to store money electronically. E-wallet makes it easier for users to disburse funds for other applications.

6. Digital Bank

A digital bank is a bank where 100% of its activities are carried out digitally. From creating an account to asset management

Fintech Legal Basis in Indonesia

The potential market owned by fintech certainly encourages the government to develop a healthy business space. That is why the government regulates regulations for the financial technology industry.

In the 2016 Bank Indonesia regulation, to be precise, Number 18 of 2016 in articles 17 and 40. Rules related to electronic money and the processing of payment transactions have been stipulated.

In addition, there is also a BI circular letter Number 18/22/DKSP regarding the implementation of digital financial services. Thus, the application of fintech in Indonesia has been regulated and has a clear legal basis.

There are also rules regarding fintech services which were inaugurated by the Indonesian Financial Services Authority Regulation Number 77/POJK.01/2016 concerning Information Technology-Based Borrowing-Lending Services.

The development of financial technology in Indonesia brings fresh air to the financial world, allowing people to access financial services more quickly and transparently, although it’s not without its challenges.

With many companies also developing fintech, the competitors are duplicating, and people’s choices are getting more diverse. Fintech companies must innovate more differences to strengthen their position in the market.

As a business management consulting firm with a history of 21 years, Skha has helped various businesses across industries. One of them is the fintech industry.

Also Read: Challenges of Digital Banking Transformation in Indonesia and Examples

Skha helps identify challenges and provides personalized solutions for each client. Learn more interesting information about the world of business and the economy through our blog and services on the service page.


“Yuk Mengenal Fintech! Keuangan Digital yang Tengah Naik Daun.” sikapiuangmu.ojk.go.id. https://sikapiuangmu.ojk.go.id/FrontEnd/CMS/Article/10468. Diakses pada 5 Juni 2022.

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