In developing a business, business owners are often faced with various challenges. One of them is the length of time it takes for customers to pay invoices.

This condition can hamper income. At the same time, business operations still require funds for various purposes.

Eventually, cash flow can run into a deficit, which is a huge risk to business continuity.

Chairman of the Indonesian Joint Payment Fintech Association (AFPI), Entjik S. Djafar, said receivables financing through invoice financing is an alternative solution that can help business owners maintain cash flow stability.

"Invoice financing is currently still a mainstay product for productive online loans in financing above Rp 2 billion. We see that as long as the scheme is tight, until now it is still safe and prospective," Entjik told SUAR, in Jakarta, Monday (11/08/2025).

Invoice financing is a financing method that utilizes unpaid invoices or bills from customers as collateral.

Through this scheme, he said, business owners can get fresh funds, ranging from 70%-80% of the invoice value that can be used for operational needs. Meanwhile, the lender will hold the invoice as collateral for the funds that have been disbursed.

When the customer finally makes payment on the invoice, the funds received are then used to repay the loan to the lender.

"With this mechanism, business cash flow is maintained, so that operational activities can continue without a hitch," he said.

A number of AFPI member platforms, such as Modalku and KoinWorks, provide this facility with official OJK regulations. The main advantage of this scheme is not only the speed of disbursement, but also a more measurable level of risk thanks to the invoice collateral that has a clear source of payment.

"There are many borrowers who have not been able to get credit facilities at banks or other IJK (financial services industry), while their needs are urgent and need a fast process where this market has quite a large potential," he said without mentioning the exact number.

However, regulation still plays a crucial role in maintaining a balance between the interests of business actors and consumer protection.

The latest policy from the Financial Services Authority (OJK) regarding loan interest restrictions is an important step towards creating a healthier and more sustainable digital financing ecosystem.

Loan interest limit

Since last January, OJK has implemented daily interest limits: 0.3 percent for consumptive loans, 0.275 percent for micro productive, and 0.1 percent for small businesses.

The goal is to protect consumers from high-interest debt, while also maintaining the sustainability of the ecosystem. 

"If the borrower is profitable, the organizer is not profitable, it doesn't work. And vice versa. The three must match," Entjik said.

He stated that 0.3 percent per day is the "sweet spot" that can maintain a balance between risk, return, and access for the public.

This limit, he said, is sufficient to cover credit risk, still gives room for organizers, and does not suffocate borrowers.

"If it is lowered to 0.2 percent, I am sure that the dispersion will decrease by a thousand percent. Organizers will hesitate to lend to risky communities," he said.

The term "pindar" (online loan) itself is a term used to replace "pinjol" (online loan) for digital financial services that are legal and licensed by the Financial Services Authority (OJK). 

This name change was made to improve the image of the fintech industry and make it easier for the public to distinguish between legal and illegal services, as the term "pinjol" is often associated with illegal and harmful practices.

AFPI's research noted that the outstanding value of illegal pinjol reached Rp 230 trillion-Rp 260 trillion, far above Pindar's total loans of "only" Rp 80 trillion. Based on Entjik's information, there is a slow "switching", a movement of users from illegal pinjol to pindar, worth Rp 200 billion-Rp 300 billion per month.

"The question is, are illegal borrowers good? Some prospects, some not, because our economic literacy is still low," Entjik said. He hopes more people "move to the right path".

Financial inclusion and behavioral shifts

Nailul Huda, Director of Digital Economy at the Center of Economic and Law Studies (Celios), said that the restrictions were made to touch on both industrial aspects and consumer safety.

"In Indonesia, access to formal finance is only owned by around 82% of the community," he said.

According to him, currently the behavioral changes are starting to be felt, people are lazy to go to the bank office, choosing digital services to meet financial needs. 

Even so, Nailul noted that most of the distribution is still consumptive, far from OJK's target of 70% for productive things.

"For example, the purchase of a laptop is considered consumptive, but for freelancers, it is a production tool," he said.

The Ministry of Communication and Digital (Komdigi) also participates in this effort through 24-hour cyber patrols that monitor and close illegal pinjol applications. "If it is not registered with OJK, take it down immediately. Don't wait for many victims," said Entjik.

From both sides of the coin, he said, interest restrictions benefit borrowers because the burden is reduced, while lenders remain interested in investing, although the response varies.

"People used to borrow from relatives, but now they are starting to use platforms," says Nailul.

He mentioned that the results of the Celios difference-in-difference study showed that countries with a fintech industry recorded financial inclusion of 0.712 points; higher than those without. Before fintech, financial inclusion was only 0.406 points. The impact is significant, especially for the lower 40% of the middle class.

Pindar asset growth

Although initially it was feared that it would suppress the industry, OJK data actually showed growth after the interest restrictions were imposed.

As of June 2024, Pindar's assets reached IDR 9.91 trillion, up 32% compared to the previous year. Outstanding funding grew 22% to 83.52%, and the bad debt level was maintained at 2.85%.

According to Hari Gamawan, Director of Development of OJK's Venture Capital Company Financing Institution, this sector is not only in demand by fintech players, but also by banks.

"If he is not able, he will have to return and his burden will be heavier if he cannot return the prison. The lenders are also differentiated between professionals and non-professionals," Hari explained.

Personal data protection

Muchtarul Huda, Director of Digital Space Supervision Strategy and Policy at the Ministry of Communication and Information, warned that pindar is vulnerable to personal data leaks.

"In the past, personal data was considered an asset that could be collected as much as possible. Now, data is a trust from the personal data subject, who has full power over its use," he explained.

Muchtarul explained that in pindar operations, almost all types of personal data are collected: full names, telephone numbers, addresses, financial data, and account information such as usernames and passwords.

He emphasized the importance of a clear basis for data processing. In the context of pindar, it is common to use the user's explicit consent when registering. Privacy notifications or policies displayed on the app should mention the purpose of data use in a transparent manner.

However, public literacy remains key. Muchtarul pointed out that there are still many villagers who are tempted by the lure of Rp 300,000-Rp 800,000 to submit biometric data, without realizing the risk of identity theft.

"In big cities, people may understand the dangers of illegal pinjol. But in the regions, the need is often stronger than security awareness," he says.

Kominfo itself is preparing a Pindar Organizing Agency (LPP Pindar) and 24-hour cyber patrols to block illegal applications without waiting for victims to fall. "It's about building a digital ecosystem that is safe, fair and trustworthy," he said.