Fintech 2026

INDONESIA Trends and Developments Contributed by: Vik Tang, Michelle Virgiany, Almira Tengku, Ruth Ginting and Ryu Wirjadi, Hiswara Bunjamin & Tandjung in association with Herbert Smith Freehills Kramer

assets which can be traded under the OJK’s regula - tory framework but cannot be used as payment instru - ments. Artificial Intelligence Throughout 2025, the authors observed a significant increase in the use of artificial intelligence (AI) in Indo - nesia’s fintech sector. This development coincides with the growing adoption of ACS by financial services companies seeking to expand access to credit for the unbanked and underbanked population. As a modern approach to evaluating creditworthiness, ACS departs from traditional reliance on banking and credit bureau data. Instead, ACS leverages alterna - tive data such as telecommunications usage, utility payment records, e-commerce transactions and, in some cases, social media indicators to develop a more comprehensive view of an individual or entity’s credit profile. This approach is particularly valuable for consumers and micro or small enterprises that lack a formal credit history, supporting broader financial inclusion objectives while enabling lenders to assess risk better. The increasing adoption of ACS has, in turn, driven a significant rise in the use of AI within the fintech indus - try. Many, if not all, ACS providers now develop and deploy AI-based models to process large volumes of alternative data and to analyse repayment capabili - ties. Machine-learning techniques are commonly used to identify behavioural patterns, predict default risk, and refine credit assessments as new data becomes available. Compared to traditional rule-based scoring systems, AI-driven models offer greater flexibility and scalability, particularly in dynamic digital ecosystems where consumer behaviour evolves rapidly. However, the growing reliance on AI in credit deci - sion-making also presents regulatory and govern - ance challenges. AI models may lack transparency or explainability, raising concerns around accountability, bias, and the risk of unfair or discriminatory outcomes, especially in high-impact use cases such as access to credit. These concerns are increasingly relevant as AI-driven models become central to assessing cred - itworthiness and managing risks across the digital financial ecosystem.

Against this backdrop, it will be interesting to observe how the OJK continues to shape its regulatory approach to the use of AI within ACS and the fintech sector more broadly. While OJK Regulation 29 of 2024 on ACS does not specifically regulate AI technolo - gies, it places strong emphasis on governance, risk management and consumer data protection, which indirectly influence how AI systems may be designed and deployed. General laws and regulations such as those on data protection and consumer protection must also be observed. In response to the expanding use of AI in banking, the OJK has also published governance guidelines on the implementation of AI, providing a baseline framework for the responsible development and application of AI systems. The regulatory focus is on responsible AI use, robust risk management, and prudential safe - guards, implemented alongside ongoing digital trans - formation initiatives. Although addressed primarily to banks, these guidelines signal the OJK’s broader expectations and may serve as an important reference point for fintech and ACS providers as AI adoption accelerates. Fit and Proper Test for ITSK Operators The OJK has further strengthened governance requirements in Indonesia’s digital finance ecosys - tem with the issuance of OJK Regulation 16 of 2025 (“OJK Regulation 16”), which came into effect on 1 October 2025 and is supplemented by OJK Circular Letter 21/SEOJK.06/2025 (the “FPT Circular Letter”), setting out detailed administrative and documentary requirements. OJK Regulation 16 introduced a single, consolidated fit-and-proper test (FPT) and a reassessment regime applicable to “main parties” ( pihak utama ) of ITSK operators, including those operating in digital finan - cial innovation, digital assets, and crypto-assets. Main parties comprise controlling shareholders, members of the board of directors, and members of the board of commissioners. Prior to OJK Regulation 16, FPT and reassessment requirements applicable to ITSK operators were dis - persed across multiple sector‑specific regulations.

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