Yogyakarta, August 18th 2022─The Center for Digital Society (CfDS) of the Faculty of Social and Political Sciences UGM again for the 52nd times held the Digitalk series with the title “Wise with Digital Finance: Discussion on Financial Products in the Middle of the Digital Era” on Thursday (18/8). This Digitalk series presents several resource persons who are experts in the field of digital finance, such as Rizki Amelia, Digital Literacy Coordinator of the Ministry of Communication and Information (Kominfo) RI; Risa Fajarwati, Head of Sub Division of Licensing, Information and Documentation of the OJK D.I. Office. Yogyakarta; Tomy H. Wibowo, Senior Pastor of New Generation GBI Yogyakarta; and Amelinda Pandu K., CfDS UGM Researcher. The Digitalk series in collaboration with the RI Kominfo focuses on discussing digital financial management.
Risa opened the discussion by explaining that the digital economy in Indonesia consists of various kinds. Each of these digital economic systems requires oversight. OJK oversees P2P Lending, digital financial innovation, security crowdfunding, and digital banking. BI oversees Gopay, OVO, and other digital payment activities. The Ministry of Finance oversees taxes and the Ministry of Social Affairs oversees social crowdfunding. “The Commodity Futures Trading Supervisory Agency (CoFTRA) oversees crypto assets, but usually the wrong address is to OJK. For example, Binomo instead goes to OJK when it should go to CoFTRA,” Risa explained.
From her experience supervising digital financial transactions at OJK, Risa knows that financial digitization makes financial transactions faster than before. However, there are new risks that come along with that speed. For financial service providers, digitalization increases competition. Commercial banks, for example, are starting to be replaced by banks that provide digital services. For consumers, illegal practices are getting easier. “For example, illegal online credit practices often ensnare digital financial users who don’t understand,” explained Risa.
Anticipation of these various risks must be carried out synergistically by service providers and consumers. Financial service provider institutions have a role to improve their services. Meanwhile, at the same time, consumers must acquire digital financial literacy.
In line with Risa, Tomy said that the financial industry is currently growing very rapidly. As a Senior Pastor at GBI New Generation Yogyakarta, Tomy shared his experience in guiding Christians to respond to the development of digital finance. “Digital finance comes with various potentials and challenges, which have the potential to lead to disaster if not handled properly,” said Tomy.
Tomy considers that financial technology is neutral. “Like a knife, digital financial technology can be used to maximize or vice versa,” said Tomy. He often finds that as much as 70% of online loans are made by student borrowers. The goal is sometimes unclear, and tends to be negative, such as for online gambling. This, as explained by Tomy, is the cause of negative things due to online loans. The unclear and negative goals behind online credit need to be controlled with digital literacy.
Connecting the two previous speakers, Amelinda revealed that there have been many transformations caused by the emergence of digital finance. One of them is the tourism of financial inclusion. “This increase in financial inclusion is due to the flexibility, convenience, and accountability provided by digital finance,” explained Amelinda.
However, Amelinda also admits that there are some downsides to digital finance. For example, there are digital financial users who are too consumptive in borrowing online loans. “However, this problem is not only the responsibility of consumers but also the responsibility of digital financial service providers,” said Amelinda.
The responsibility of digital service providers, according to Amelinda, is to provide ethical services. “There are many digital providers who persuade consumers to act consumptively so that it benefits their services,” explained Amelinda. This may increase the profits of digital service providers but will be very detrimental to consumers who are consumptive.
In the end, according to Amelinda, the negative impacts of digital finance should be a shared responsibility between consumers and digital service providers. “Consumers must be wise, while digital service providers must stop providing false dreams through their advertisements,” said Amelinda. Without the role of both, the negative impacts of digital finance will continue to roll over.