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New OJK Regulation on Buy Now Pay Later (BNPL) Services
29 Jan 2026 Insight Jakarta
Article - By Michelle Virgiany Naila Amatullah

Introduction

The term BNPL has been around for some time as a subset of financing products, but its growth has accelerated rapidly in Indonesia in recent years. According to OJK, as of October 2025, outstanding BNPL credit (baki debet kredit) in banks surged 21.03% yoy, while BNPL financing by multi-finance companies rose 69.71% yoy.

In response to the rapid growth in BNPL services, OJK issued Regulation No. 32 of 2025 on the Implementation of BNPL (the OJK BNPL Regulation), which took effect on 15 December 2025, subject to the transitional provisions explained below. The new regulation provides a framework for various aspects of BNPL services. It aims to provide regulatory certainty and ensure compliance with prudential principles, good governance and sustainable industry growth.

Banks and multi-finance companies offering BNPL facilities must also ensure compliance with other sectoral regulations. For example, multi-finance companies must comply with requirements applicable to ‘digital financing services’, a concept introduced in 2024 through OJK Regulation 46 of 2024 on the Development and Strengthening of Financing Companies, Infrastructure Financing Companies, and Venture Capital Companies. For further insight on the digital financing regulations, see our article in Chambers Fintech Global Practice Guide 2025.

 

Key Provisions

BNPL is defined as “a financing facility provided by financial services institutions through electronic systems for the purchase of goods and/or services.” Its key features are:

  • it is intended for non-cash purchase of goods and/or services (excluding credit cards);
  • it is unsecured;
  • it is subject to a set limit (excluding credit card limits);
  • the repayment of principal and/or interest, margin, return, or ujrah is made according to the agreed instalment or payment scheme;
  • the approval process for consumers to use BNPL services is conducted via (a) face-to-face electronic meetings (eg by video call or video conference) or (b) non-face-to-face electronic interaction (eg through an application or website without a video call or video conference); and
  • it is conducted through electronic systems.

BNPL services may be offered by commercial banks and multi-finance companies based on either conventional or sharia principles.

For commercial banks, the implementation of BNPL services must follow relevant sectoral regulations (eg OJK regulations on commercial bank products).

Multi-finance companies must also follow relevant sectoral regulations (eg OJK regulations on the business activities of multi-finance companies). Notably, the OJK BNPL Regulation expressly requires multi-finance companies to obtain prior approval from OJK before launching BNPL services.

In providing BNPL services, commercial banks and multi-finance companies may cooperate with third parties (eg e-commerce platforms). When doing so, they must ensure that there is transparency of information to customers. Requirements under other sectoral regulations must also be complied with.

Commercial banks and multi-finance companies must disclose certain information to consumers via electronic systems so that they can make informed and responsible financing decisions. This information includes:

  • source of funds for the financing, in case the financing involves joint financing, channelling, and/or assignment to another party;
  • amount and frequency of installments; and/or
  • any other information determined by OJK.

Non-compliance with this disclosure requirement may lead to administrative sanctions, including a written warning, a fine of up to IDR15 billion (~US$937,500), and/or business licence revocation.

 

The OJK BNPL Regulation emphasises the importance of consumer protection by stating that information disclosure, personal data handling, and collection mechanisms for BNPL services must be carried out in accordance with OJK’s consumer protection regulations.

Commercial banks and multi-finance companies must report to OJK on implementation of their BNPL services.

Under the OJK BNPL Regulation, OJK may:

  • set maximum economic benefits limit for multi-finance companies. The OJK BNPL Regulation allows OJK to set maximum economic benefit limits specifically for BNPL services offered by multi-finance companies. It is worth noting that the concept of maximum economic benefit limits has also been implemented in the peer-to-peer lending sector.
  • adopt flexible policies. The regulation allows OJK to keep some flexibility by setting policies that differ from the regulation, where required, in the interest of national policy, public interest, industry growth or fair competition.
  • require banks and multi-finance companies to cease BNPL operations. This authority may be exercised upon any breach of the regulations, an increased risk profile that cannot be properly mitigated, and/or an increase in customer complaints which cannot be resolved satisfactorily.

Commercial banks and multi-finance companies already offering BNPL services have until 15 June 2026 to adjust their services to comply with the BNPL characteristics set out in the OJK BNPL Regulation.

Existing BNPL financing agreements and cooperation agreements entered into before 15 December 2025 will remain valid. However, any amendments to those agreements must now comply with the OJK BNPL Regulation.

Conclusion

The OJK BNPL Regulation provides regulatory certainty for commercial banks and multi-finance companies, whether they are already offering or planning to offer BNPL services. It supports operational compliance and innovation in Indonesia’s digital financing market.

That said, commercial banks and multi-finance companies must also ensure that the sectoral regulations which the new regulation refers to are also carefully observed when offering BNPL services.

The OJK BNPL Regulation will likely be followed by more detailed implementing rules from OJK. In early 2025, OJK released a draft circular letter on BNPL services offered by multi-finance companies, indicating forthcoming operational guidance.

We will keep you updated on further developments in the implementation of BNPL services in Indonesia.

(Trainee Deron Idris assisted the authors in preparing this legal update.)

Key contacts

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Michelle Virgiany

Partner, Herbert Smith Freehills Kramer Prolegis Alliance

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Financial Services Regulatory Fintech Michelle Virgiany