Capital Participation by Commercial Banks in Digital Financial Innovation Organizers Regulated

Information technology (“IT”) has been developing rapidly in Indonesia and is transforming banking business operations. The Financial Services Authority (Otoritas Jasa Keuangan – “OJK”) has stated that collaboration between the banking industry and financial services companies is required within certain digital ecosystems. Amongst other measures, one form of such collaboration is capital participation.[1] As such, the OJK has issued Regulation No. 22 of 2022 (“Regulation 22/2022”) on Capital Participation Activities by Commercial Banks (“Banks”), which is also in line with the OJK’s policy on digital transformation, as outlined in the Indonesian Financial Services Sector Master Plan 2021 – 2025.[2]