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Fintech Peer to Peer Lending, modern version of Saving-Loan Co-op?

Updated: Sep 15

By: Alifia Putri (alifia.putri@launcher.id)

Fintech Lending and Saving-Loan Co-op, Similar in Different Ways


During today’s pandemic, many businesses are going down and workers are being laid off. This situation increases the need for lending facilities, both for business and individual purposes. The high interest and background of the lender are no longer in their consideration. On July 3rd, 2020, Financial Services Authority’s Investment Alert Task Force (“OJK’s Task Force”), banning another 105 Illegal Fintech entities. The said Illegal Fintech is Fintech Peer to Peer Lending or also recognized as P2P that does not have licenses from the OJK. Interestingly, some entities among those 105 are Saving-Loan Co-op (Koperasi Simpan Pinjam or “KSP”). Even though both KSP and P2P providing loans from the mutual fund, yet they are still not the same.

What is KSP?

According to Government Regulation No. 9 of 1995 on the Implementation of Saving-Loan Business Activity (“PP 9/1995”), KSP is a cooperative body which provides business operations in collecting and distributing fund through saving-loan facilities to its member, prospective member, and another co-op body and/or its member. As cooperative bodies in general, KSP may be in the form of primary or secondary cooperative bodies. The establishment process is also the same as cooperative bodies in general. The distinction is only its business activity, which its member or prospective member, after paying the basic saving and compulsory saving, would be allowed to save or deposit their fund to the KSP. In addition, KSP could also provide loan facilities to its member and prospective member even another cooperative body, in which the source of fund falls from the mutual fund of its member.


KSP is regulated and supervised directly by the Ministry of Cooperative & Small Medium Enterprises (“Kemenkop UKM”)


Get to Know Fintech Lending (P2P)?

Financial Technology-Based Lending Services (Layanan Pinjam Meminjam Uang Berbasis Teknologi or “LPMUBTI”) or well-known as Fintech Peer to Peer Lending/P2P is formally described as a financial services provider to connecting lenders and borrowers directly to entering into Credit Agreement in Rupiah through the online electronic system, by Regulation of OJK No. 77/POJK.01/2016 on the Financial technology-Based Lending Services (“POJK 77/2016”). The same as KSP, P2P also provides loan facilities to individual and/or legal entity which the source of fund is from the lenders. P2P only connecting and listing the parties who need the loan facilities and parties who want to be the lender.

P2P is regulated and supervised directly by OJK. Every P2P player shall obtain the certification and recommendation from the Association of Fintech Lending Indonesia (Asosiasi Fintech Pendanaan Indonesia or “AFPI”) before applying the registration to OJK. After being registered for a year in OJK, the P2P will continue to the licensing process in OJK.

Yes, P2P and KSP seem similar but they are not the same. In a nutshell, both KSP and P2P could provide loan facilities from the mutual fund. The differences between KSP and P2P are explained below:

Therefore, KSP and P2P are both engaged in disbursing loan facilities in which the source of fund falls from the mutual fund, but this does not necessarily mean P2P is the digitalization of KSP. The major differences between KSP and P2P are the loan disbursement method and serving target. Pursuant to the regulations, P2P is allowed to provide loan facilities to any third party who meets the qualification as a borrower. Meanwhile, KSP is only authorized to provide loan facilities to its member or prospective member.

Digital Cooperative

While Indonesia has not yet released any Digital Cooperative Regulations, the cooperative in digital form has now become quite popular among the business community. This is in line with the statement of the Minister of Cooperative & Small Medium Enterprises, Mr. Teten Masduki, when opening the online discussion in Commemoration of the 73rd Cooperative Day and the 5th SME Day. Mr. Teten Masduki said that cooperatives should have entered the digital sector so that cooperatives are not eroded by the current development. As mentioned earlier, not the operation system of the cooperative switching to digital entirely, but the technologies used to improve the service of cooperative to its member. The same thing happened to KSP, the technologies used to digitalize and modernize the cooperative to improve the quality of service to its member and prospective member.


LID Advisory is a publication prepared by Launcher.id. It is intended to inform in general topics covered only, and should not be treated as a legal advice or relied upon when making business activities or investment decisions. Should you have any inquiries on the matters contained in LID Advisory, or other comments generally, please contact us at contact@launcher.id.

All content presented herein is for informational purposes only. Nothing should be construed as legal advice. Transmission and receipt of this information is not intended to create and does not constitute, an attorney-client relationship with PT Sinergi Konsultasi Indonesia. There is no expectation of attorney-client privilege or confidentiality of anything you may communicate to us in this forum. Do not act upon any information presented without seeking professional counsel.

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