By Anto Prabowo, Lecturer at the Faculty of Economics and Business, UNS Solo
Amid the dynamics of national economic policy, the emergence of two nearly simultaneous events should serve as a serious warning regarding the direction of Indonesia’s financial system management. The first is the decision by the Business Competition Supervisory Commission (KPPU) to impose sanctions on online lending platforms (pinjol) for allegedly colluding on interest rates.
Second is the growing trend of criminalizing non-performing loans (NPLs), where bankers face legal proceedings when financing decisions do not go as expected.
Both appear to fall under different domains—business competition and criminal law. However, upon closer examination, both share the same underlying problem: the system’s inability to distinguish between regulated market behavior and actual legal violations.
When interest rate caps are treated as cartel activity and credit risk is viewed as a criminal act, what emerges is not merely a difference in interpretation, but a fundamental misalignment in understanding the basic logic of the financial system.
From a legal perspective, the KPPU’s actions are grounded in Law No. 5 of 1999 on the Prohibition of Monopolistic Practices and Unfair Business Competition, specifically regarding the prohibition of price-fixing. Theoretically, this approach aligns with the industrial economics perspective developed by Jean Tirole (2014), which views price coordination as a form of distortion of market mechanisms. However, this approach becomes problematic when rigidly applied to the highly regulated financial services sector.
In legal doctrine, the principle of lex specialis derogat legi generali is recognized, whereby a special rule takes precedence over a general rule. The financial services sector operates under a special regulatory regime overseen by the Financial Services Authority (OJK) pursuant to Law No. 21 of 2011. In this context, the setting of interest rate caps in fintech lending is not merely a business agreement but part of a policy design aimed at balancing access to financing with consumer protection.
Financial economics literature indicates that in imperfect markets, particularly those characterized by asymmetric information, price intervention is actually necessary. This is emphasized by Joseph Stiglitz and Andrew Weiss in their classic work Credit Rationing in Markets with Imperfect Information (1981), which explains that without intervention, credit markets can suffer serious failures.
In the context of fintech lending, the absence of interest rate caps significantly increases the risk of consumer exploitation, particularly for vulnerable groups. Therefore, interpreting interest rate cap policies solely as a form of cartel activity risks leading to erroneous law enforcement that actually undermines the goal of consumer protection.
On the other hand, the phenomenon of criminalizing NPLs points to a more fundamental problem in the legal approach. In a number of cases, non-performing loans are treated as an indication of a criminal act based on state losses or procedural irregularities. This approach contradicts a fundamental principle of criminal law, namely the requirement of mens rea or criminal intent. In many lending decisions, there is no intent to cause harm, but rather a business decision made based on data, analysis, and rational judgment at the time.
In modern corporate law, the business judgment rule protects decision-makers as long as they act in good faith, based on adequate information, and without conflicts of interest. This concept was systematically developed by Melvin Aron Eisenberg in *The Divergence of Standards of Conduct and Standards of Review in Corporate Law* (1993), which asserts that rational business failures should not be criminalized.
In the banking context, the intermediation theory developed by Xavier Freixas and Jean-Charles Rochet in *Microeconomics of Banking* (2008) asserts that non-performing loans are part of expected losses, not exceptional deviations. In other words, NPLs are an inherent part of the system, not an automatic indicator of misconduct.
When non-performing loans are treated as criminal offenses, what is known in economic literature as the “chilling effect” arises. Banks become extremely cautious—even defensive—in extending credit. Risk is no longer viewed as something to be managed, but rather as something to be avoided. Under such conditions, the banking sector’s intermediation function weakens, and ultimately economic growth is affected. Joseph Stiglitz (1981) himself emphasized that credit markets will not function optimally if risks cannot be taken rationally.
If these two phenomena are viewed within a single framework, a serious contradiction in public policy becomes apparent. On one hand, price controls in regulated sectors are considered a violation. On the other hand, the realization of risk in the same sector is treated as a crime. This inconsistency creates legal uncertainty that directly impacts the behavior of industry players.
In such a situation, the role of the OJK becomes crucial in restoring legal certainty and rationality within the financial sector. The OJK must take strategic steps that are not merely technical but also normative and coordinative.
The OJK must be able to explicitly define the boundary between business risk and criminal acts, so that business decisions made in good faith are not subject to the threat of criminalization. In addition, the OJK needs to strengthen cross-agency coordination, particularly with the KPPU and law enforcement agencies, to prevent narrow interpretations of financial sector policies.
Furthermore, the OJK needs to develop a risk-based supervisory framework that focuses on the process, governance, and intent behind business decisions, rather than solely on the final outcome. At the same time, improving legal and economic literacy among stakeholders, including law enforcement agencies, is an urgent necessity to ensure a comprehensive understanding of the characteristics of the financial sector.
Ultimately, what is at stake is not only legal certainty for industry players but also the sustainability of the financial system itself. Without legal certainty, there will be no courage to take productive risks. Without risk, there will be no credit. And without credit, economic growth will lose one of its primary drivers.
What we face today is a test of the state’s ability to understand the complexities of the modern economy. Maintaining healthy competition and enforcing the law firmly are important. However, both must be done with a comprehensive understanding of how the financial sector operates.
Otherwise, we will remain trapped in a paradox: regulated prices are seen as a violation, while unavoidable risks are viewed as a crime. Under such conditions, the financial system not only loses its direction but also its very essence. (*)
