JAKARTA - The Financial Services Authority's Investment Watch Task Force has found 105 unlicensed peer-to-peer (P2P) lenders and 99 unlicensed investment platforms. The task force believes that the rise of illegal P2P lenders is partly due to the economic impact of the coronavirus (COVID-19) pandemic.

"They target people with economic hardships who need money to meet their needs. These illegal lenders are very dangerous because they set high interest rates and short loan periods while demanding access to all mobile phone contacts. This is dangerous because such data can be leaked and used to intimidate borrowers into paying," said Investment Watch Task Force Head Tongam L. Tobing in a press release on Friday (3/7).

Since 2018, the task force has handled 2,591 illegal P2P lenders and suspended the operations of 99 unlicensed lenders.

According to Mr Tobing, there are concerns about the danger of illegal lenders that exploit people's lack of awareness about investment security by offering abnormally high returns. "Many of these lenders duplicate the websites of licensed companies to make the impression that they operate with proper licenses," he said.

Of the 99 illegal companies, 87 offer futures trading services, two engage in direct selling, three offer illegal cryptocurrency investments, and three offer cash investments. (LK/MS)