Governing the gold rush into emerging markets: a case study of Indonesia’s regulatory responses to the expansion of Chinese-backed online P2P lending

Angela Tritto, Yujia He, Victoria Amanda Junaedi

Research output: Contribution to journalArticlepeer-review

6 Scopus citations

Abstract

Peer-to-peer (P2P) lending has the potential to boost financial inclusion in emerging markets. This paper contributes to the literature on fintech governance in emerging Asian markets. It examines the case of the Indonesian government’s approach in regulating the P2P lending sector using both primary interviews and secondary firm-level data. Driven by regulation tightening in China and regulatory gaps in Indonesia, Chinese investments became the largest in this sector contributing, however, to growing risks from illegal business practices. The Indonesian government responded by creating new regulations and institutions, mitigating risks without stifling the potential for financial inclusion. We conclude a proactive approach towards monitoring and regulating emerging high-tech industries should be sought by strengthening links with industry and civil society, and through international cooperation for policy and knowledge sharing.

Original languageEnglish
Article number51
JournalFinancial Innovation
Volume6
Issue number1
DOIs
StatePublished - Dec 2020

Bibliographical note

Publisher Copyright:
© 2020, The Author(s).

Keywords

  • Emerging market
  • Fintech
  • Governance
  • Internet finance
  • P2P

ASJC Scopus subject areas

  • Finance
  • Management of Technology and Innovation

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