Jakarta. The Indonesia Fintech Society (Amvesindo) has expressed support for a plan by financial authorities to raise the cap on loans from peer-to-peer (P2P) lending platforms from the current Rp 2 billion to Rp 10 billion, stating that the increase will broaden market demographics.

The Financial Services Authority (OJK) has disclosed this plan to aid the P2P lending industry in expanding its coverage and providing small and medium enterprises (SMEs) with greater access to financing.

“The Rp 10 billion cap will cover a new demographic of borrowers,” said Eddi Danusaputro, a representative of Amvesindo, during a talk show at IDTV.

An increased lending cap also offers more flexibility to P2P lending platforms in extending their operations to areas outside of Java, Eddi noted.

Approximately 70 percent of lenders participating in the P2P lending system reside in Java, limiting the geographical reach for potential customers in other islands, he added.

“This lending platform is crucial in our economy to ensure that all elements of society have access to capital sources other than banks,” Eddi said.

Since its introduction in Indonesia several years ago, the P2P lending platform has channeled Rp 850 trillion ($52.4 billion) in capital and consumer credits, according to Eddi.