How Peer-to-Peer Fintech Lending Works in Indonesia

Online funding and loans have become part of Indonesian life, with many people turning to borrowing to cover day-to-day needs. Lending money is an old practice, dating back to when money replaced the barter system the country once used. Money is crucial to life today, because without it you cannot do anything. As life moved on, borrowing and lending changed along with the times. Today we know the term fintech in Indonesia, short for financial technology.

Read also: 5 Leading Fintech Apps in Indonesia

Financial errands that once meant traveling, meeting face to face and preparing a stack of photocopied documents are now made easy by technology, with just a smartphone. Financial companies can now stand on their own, without opening many branches or hiring many people to run the business. A few taps on the screen get everything moving. You can fund or borrow from home alone. How fintech companies work in the loan-based, or peer to peer , model follows this flow:

The App

Users have to download an Indonesian fintech app from the online app stores. These apps are usually free. All you need is a phone and an internet connection. After downloading it, you can register by filling in your details in the app.

Read also: Why Are Fintech Services So Important?

From Lender to Borrower

Once you have entered your personal details, you can apply for a loan through the app. Online loan apps usually process requests quickly, from under 24 hours to a matter of days. If it takes longer than that, you can be sure your loan has been rejected. If your loan is approved, the lender will access your data and can begin lending you funds. You can receive the money right away and agree to repay it on credit terms or in installments.

Tips for Downloading a Fintech App

Before you download an online loan app, make sure the permissions it requests at the start do not intrude on your privacy. Read the rules on borrowing and repayment carefully. Do not let the interest rate set work against you. Learn the company's regulations for online lending. Search for the app and fintech company name in a search engine to learn its reputation. Make sure the company is registered with OJK (Indonesia's Financial Services Authority) so you have protection as either a borrower or a lender. Also check whether the company has had problems and appears on Bank Indonesia's blacklist. If everything checks out, you can go ahead and borrow and lend online with peace of mind.

Congratulations, you can now enjoy today's financial technology and use it safely and comfortably!

Read also: Fintech Companies in Indonesia