THE ANALYSIS OF FINANCIAL SERVICE AUTHORITY IN REGULATING PEER-TO-PEER LENDING INDUSTRY

• Main Author: Aldipta, Ryandana
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/38855
• Institution: Institut Teknologi Bandung

Peer-to-peer lending is an innovation in the financial service industry or fintech. This industry is quite booming (100 companies registered in less than 2 years) in Indonesia recently. The organization that regulates this industry is the Financial Service Authority (FSA). The sub division of FSA that directly handle the industry is Directorate of Regulation, Licensing, and Supervision of Fintech (DRLSF). The directorate was founded in 2017. Not only that the Industry is new but the regulator is also new. The booming condition of the industry made the regulator overwhelmed. Unlike other regular organization that has a chance to grow step by step. DRLSF has to deal with this large industry right from the start. Many companies trying to register themselves to FSA. In the first year of the DRLSF’s operation, there are around 70 companies has registered. This number keep increasing. Those condition makes the licensing process become a bottleneck to the DRLSF’s operational. To find how DRLSF carry out it’s duty, an analysis of the organization was conducted using McKinsey 7-S Framework. The result was there are some areas that DRLSF is doing well. But there are also some area that DRLSF still lacking. Those area include the strategy, system, structure, and human resource. Cause and effect diagram was also used to find the root cause of the problem. The result was, the root cause of the unclear of strategy on regulation was lack of Research Fellow (RFs), the root cause of the lack of human resource was lack of recruitment, and the root cause of the system problem was manual system. The solution should be to correct the areas that are still lacking and priority should be given to the factor that affect the main problem (the bottleneck of the licensing process).