Digital Age and Consumer Protection of Financial Services in Indonesia

Widijantoro, Johanes (2019) Digital Age and Consumer Protection of Financial Services in Indonesia. In: 2019 IAFICO Annual Conference Global Forum for Financial Consumers : Reshaping Investment and Financing through Digital Innovation, August 19-20, 2019, Gadjah Mada Unviersity, Yogyakarta, Indonesia.

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Abstract

Digitalization has penetrated various industrial sectors including financial services which have brought various changes in the production, distribution and consumption patterns. Like all new developments, there is potential for both increased opportunities and risks for consumers. It was broadly known that consumers of financial services were frequently damaged because of various unfair trade practices conducted by financial service providers, their low level of financial literacy, and the weakness of consumer protection policy. Making sure the foundations of a connected system are designed to benefit consumers will be essential. This article aims to explore the problems and challenges faced by policy makers, especially Financial Services Authority / Otoritas Jasa Keuangan (OJK) in protecting the interests of consumers of financial services in the digital era. One of the challenges faced by the OJK is running a dual role i.e. on the one hand should ensure financial services providers operate correctly and responsibly, and on the other hand also must empower and protect consumers' interests. Begins by describing the situation of the financial services consumer protection in Indonesia, this article will further examine the protection of what is required by the consumer financial services and consumer protection policies which should be taken by the OJK in order to address the challenges faced. Some suggestions and recommendations will be submitted to end this article.

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