Indonesia's Financial Services Authority (OJK) has introduced new restrictions for users of Buy Now, Pay Later (BNPL) services. According to a report from Kontan.co.id, borrowers must now be at least 18 years old or married and have a minimum monthly income of Rp 3 million.

Agusman, OJK’s Head of Supervisory for Financial Institutions, stated that the measure aims to shield consumers from potential debt traps. “This age restriction is implemented to ensure consumer protection and anticipate risks for users with limited financial literacy,” he explained during a press conference on January 7, 2025.

The BNPL industry has experienced significant growth, with total transactions reaching Rp 8.41 trillion by October 2024—a 63.89% increase year-on-year. Meanwhile, financing receivables for BNPL providers surged 61.90% to Rp 8.59 trillion as of November 2024.

Agusman highlighted that the regulation is also intended to support sustainable growth in the financing sector. “More companies are entering the BNPL business, so it’s important to establish rules that protect both consumers and the industry,” he added.

Despite the rapid growth, the gross non-performing financing (NPF) rate for BNPL providers increased slightly, from 2.76% in October to 2.92% in November 2024. This trend underscores the importance of regulating lending practices to maintain financial stability.

OJK’s new policies reflect the authority's effort to balance the rising demand for digital credit services with consumer protection. The ongoing expansion of Indonesia’s digital economy is expected to further drive the development of the BNPL industry.

With these changes, OJK aims to ensure that BNPL remains a viable and responsible financing option while safeguarding users from potential financial risks.

SOURCE: KONTAN | PHOTO: KOMINFO JATIM