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P2P lending platforms wrestle with dangerous loans amid COVID-19 – Enterprise

The fintech business could be combating dangerous loans as lenders in peer-to-peer (P2P) lending platforms turned down greater than half of loan restructuration request from debtors because the pandemic impacts individuals’s funds, a survey exhibits.

Out of 1.96 million loan restructuration requests acquired by 88 P2P lending platforms in May, solely 34 p.c of them have been granted, with the remainder denied by the lenders, Indonesian Fintech Lenders Affiliation (AFPI) information present.

The full quantity of reported excellent loans that have been requested to be restructured in May stood at Rp 1.08 trillion (US$75.9 million), with simply Rp 236.9 billion authorized by the lenders.

“Fintech P2P lending platforms can only facilitate loan restructuring requests from borrowers to lenders but the authority to grant eased loan payment lies with the lender,” mentioned AFPI spokesperson Tumbur Pardede in a press convention on Tuesday. 

The Monetary Providers Authority (OJK) has beforehand acknowledged that lenders, not platforms, bear the dangers for loans in fintech lending.

Affiliation members have completely different mechanisms in managing requests to ease loan reimbursement, because it is determined by the situation of every borrower. Those that defaulted previous to the pandemic won’t possible obtain restructuration, Tumbur mentioned.

Tumbur additionally mentioned a loan can be thought-about to have defaulted as soon as the borrower failed to meet the reimbursement inside 90 days previous the due date.

Beforehand, the affiliation famous that the pandemic had decreased the 90-day success loan settlement fee (TKB90) to 95.78 p.c in March in comparison with 96.08 p.c in February, AFPI managing director Kuseryansyah mentioned.

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“This was to be expected but the decrease in loan repayment rate is still in the normal range, showing good repayment capacity,” he mentioned.

In response to the OJK, the non-performing loan (NPL) ratio in March stood at 4.22 p.c, a rise from 3.98 p.c in January and three.93 p.c in February.

Regardless of the next NPL ratio, the OJK famous that as of April, fintech P2P lending financing had reached Rp 106 trillion, indicating a staggering 186.5 p.c progress year-on-year.

The AFPI additionally nonetheless anticipated extra loan disbursement post-COVID-19.

In the meantime, P2P lending platforms have established their very own phrases to facilitate debtors affected by the pandemic.

P2P lending platform Pinjam Modal, for instance, has eradicated the late fee high quality for debtors whose companies have been impacted by COVID-19.  

Moreover, to assist debtors, AFPI chairman Adrian Gunadi mentioned the affiliation was in talks with the OJK to briefly enhance the restrict for funding to Rp 10 billion from the present Rp 2 billion to assist them get well after the pandemic.

“We are discussing this plan because some platforms need to be able to raise more money, especially for businesses to prepare for the post-pandemic situation,” he mentioned.

Adrian added that solely companies in sure sectors which can be essential throughout the pandemic comparable to medical and meals and beverage may apply for the motivation.

Commenting on the matter, OJK spokesperson Sekar Putih Djarot urged the AFPI to encourage its members to ease the burden of the debtors affected by the pandemic. Nevertheless, the company reasserted that fintech P2P lending corporations couldn’t act as lenders like banks.

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“As its main function is as a platform, fintech P2P lending companies do not have the authority to restructure loans,” Sekar mentioned on Tuesday.

Through the press convention, the AFPI additionally introduced eight new P2P lending platforms licensed by the OJK, specifically Alami, Awan Tunai, Dana Rupiah, Indodana, Julo, Pinjam Modal, Pinjam Win/Win and Teralite.

The eight platforms convey the entire variety of licensed fintech P2P lending platforms to 33.

Presently, there are an estimated 128 different fintech P2P lending corporations which were registered however have but to be licensed, OJK information present.

If you wish to assist in the combat in opposition to COVID-19, now we have compiled an up-to-date record of group initiatives designed to help medical staff and low-income individuals on this article. Hyperlink: [UPDATED] Anti-COVID-19 initiatives: Serving to Indonesia combat the outbreak
 

Jung Min-seo

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