THE EMERGENCE OF PEER-TO-PEER LENDING IN INDONESIA: A COMPARISON STUDY AND A RISK MANAGEMENT ANALYSIS TO CONVENTIONAL BANKING INDUSTRY

• Main Author: Eglesias Paulus/29116071, Yesaya
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/31732
• Institution: Institut Teknologi Bandung

Peer-to-peer lending has been growing since 2006 in the U.S., but in Indonesia the first peer-to-peer lending has just emerged recently in 2016. Peer-to-peer lending fintech companies are able to perform the credit lending service in a more efficient and satisfactory way for customers compared to conventional bank. Some findings have shown that peer-to-peer lending fintech is able to disrupt and snatch conventional bank’s market share. <br /> <br /> <br /> <br /> <br /> Since the technology is still new in Indonesia, this study aims to understand peer-to-peer lending business and its comparison with conventional banking. After understanding peer-to-peer lending’s capabilities in comparison with conventional banking companies, the study identifies and analyzes probable business risks in conventional banking companies regarding the emergence of peer-to-peer lending in Indonesia. And finally measure the identified risk using analytical hierarchy process (AHP). <br /> <br /> <br /> <br /> <br /> The data is collected through questionnaires and from the websites of banking and peer-to-peer lending fintech companies with additional third party sources such as Otoritas Jasa Keuangan & Bank Indonesia. The identified risk is then analyzed in the AHP Software ExpertChoice to measure the importance, likelihood, and impact of each risk. Lastly, the study formulates the mitigation strategy for conventional banking companies to take.