MICROCAPITAL BRIEF: Indonesia’s Otoritas Jasa Keuangan to Regulate Microfinance Institutions Beginning in 2015

Otoritas Jasa Keuangan (OJK), an agency of the Indonesia government that regulates the financial services sector, has announced that it will take over the role of regulating microfinance institutions (MFIs) from Bank Indonesia, the central bank of Indonesia, in 2015. OJK has regulated banks and non-bank financial institutions in Indonesia since it was founded in 2011. In addition, OJK plans to increase public awareness of illegal financial products and investment opportunities from outside the country, especially those that promise high returns, but do not keep public records or guarantee assets. These illegal investment products, which may be sold in partnership with securities firms, function like multi-level pyramid schemes.

By Megan McGowan, Research Associate

About Bank Indonesia:

Established in 1999, Bank Indonesia is the nation’s central bank. Its primary objective is to maintain currency stability by: formulating and implementing monetary policy, regulating and ensuring smooth operation of payment systems, and regulating and supervising the national banking system. As of 2013, Bank Indonesia’s governor is Mr Agus Martowardojo.

Sources and Additional Information:

[1] Antara News: “OJK to Monitor Micro-finance Institutions from 2015 Onward,” http://www.antaranews.com/en/news/90670/ojk-to-monitor-micro-finance-institutions-from-2015-onward

MicroCapital Story: “Standard Chartered Bank (SCB) Loans $5.7m to Bank Andara to Support Microfinance Institutions (MFIs) in Indonesia,” July 4, 2013, https://www.microcapital.org/microcapital-brief-standard-chartered-bank-scb-loans-5-7m-to-bank-andara-to-support-microfinance-institutions-mfis-in-indonesia/

MicroCapital Story: “Standard Chartered Indonesia Loans $3m to Bank Andara to Finance Lending, Technology Services for Microfinance Institutions,” October 17, 2012, https://www.microcapital.org/microcapital-brief-standard-chartered-indonesia-loans-3m-to-bank-andara-to-finance-lending-technology-services-for-microfinance-institutions/

MicroCapital Universe Profile: Otoritas Jasa Keuangan (OJK) https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Otoritas+Jasa+Keuangan+%28OJK%29

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