Industry Supports The Inclusion Of Social Media & Electricity Bills For Credit Assessment

Tuesday, 19 Nov 2024

By putri@insightinnews.com The Indonesian Peer-to-Peer Lending Fintech Association (AFPI) has expressed its support for the introduction of alternative credit rating agencies (PKA), with the expectation that relevant regulations will be established by the end of this year. The PKA, or Initiative Credit Scoring (ICS), is intended to complement the existing credit assessment indicators used by financing institutions. The data provided by the PKA may include information from potential borrowers' activities, such as utility payment records for electricity, telephone, and apartment bills, as well as their social media activities. Kuseryansyah, the Head of Public Relations at AFPI, believes that the presence of the PKA will not complicate the criteria for financing distribution; rather, it will broaden the customer segmentation within the peer-to-peer (P2P) lending industry. He explained that the online lending sector has traditionally relied on fintech data centers to evaluate potential borrowers. Kus noted that the PKA will enhance the assessment of borrowers from diverse backgrounds. "There are various types of customers and segments that can be evaluated based on their utility subscription behaviors. If the loan amount is not excessively large, that may suffice," stated Kus, who is also the CEO of 360Kredi, during an event at Mall Kota Kasablanka on Tuesday, November 12, 2024. However, he added that for larger loans with longer tenors, the analysis becomes more complex, necessitating a range of data, including information from SLIK, non-SLIK sources, and the Initiative Credit Scoring. Kus stated that players in the fintech peer-to-peer lending sector will increasingly benefit from the growing availability of borrower analysis data. "Essentially, the lending landscape becomes more favorable as the amount of data available for analysis increases. We are more pleased. Our ability to comprehensively assess a potential borrower improves," he concluded. He further explained that with the increasing availability of borrower data, risks can be quantified. Consequently, fintech peer-to-peer lending players can select the risk profiles of customers they wish to target. "The risks become more measurable and calculable, allowing us to make informed decisions. The platform can then determine which segment to engage with—whether it be high-risk, medium-risk, or low-risk segments. Ultimately, every individual has a profile that reflects their scoring metrics," Kus remarked. Previously, Hasan Fawzi, the Head of the Financial Sector Technology Innovation Supervisory Agency, Digital Financial Assets, and Crypto Assets at OJK, indicated that the regulatory framework for the implementation of PKA is in its final stages and is being pushed for harmonization. He expressed hope that the OJK regulation (POJK) would be published within a month or by the end of the year. Hasan revealed that there are currently four ICS providers that have successfully passed the regulatory sandbox and are registered. Additionally, there are ten prospective ICS providers in the regulatory sandbox awaiting licensing approval. He noted that once the licensing regulations from OJK for PKA are issued, ICS providers will be treated similarly to Financial Services Business Providers (PUJK).

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