On early Q2 2022, our Minister of Finance effectively use new regulation regarding Financial Technology and this regulation affected Income Tax and Value-Added Tax. Financial Technology implementation is the activity of using technology in the financial system that produces new products, services, technology, and/or business models and can have an impact on monetary stability, financial system stability, and/or efficiency, smoothness, security, and reliability of the payment system.


The implementation of Financial Technology has several products, services and business models such as:


  1. Peer to Peer Lending
  2. Electronic Money
  3. Electronic Wallet
  4. Payment Gateway
  5. Switching Service
  6. Clearing
  7. Final Completion
  8. Fund Transfer
  9. Effect
  10. Implementation of Investment
  11. Management Market Support Services

Income Tax on Financial Technology Implementation
Income Tax on Financial Technology Implementation

Based on Minister of Finance Regulation Number 69/PMK.03/2022, here’s how the Income Tax and Value-Added Tax impacted


Peer to Peer Lending (Fintech Lending)  consists of: lenders, borrower, and providers of lending and borrowing services. Interest is paid by the borrower to the lender through a Fintech Lending.


The Minister of Finance requires lending and borrowing service providers to deduct Income Tax (PPh) on income in the form of interest received by the lender. Borrowers who provide interest do not deduct Income Tax. Fintech Lending which appointed as the deductor must received a permit and registered in the Financial Services Authority (OJK).


The Income Tax deducted by the Fintech Lending is Article 23 Income Tax of 15% if the lender is a Domestic Taxpayer or Permanent Establishment, and Article 26 Income Tax of 20% if the lender is a Foreign Taxpayer other than a Permanent Establishment.


Fintech Lending is able to receive or earn income in the form of fees, commissions, ujrah, or other rewards in the name and in any form from the borrower and/or lender in the connection with the Fintech Lending activity. This includes income received by the Fintech Lending in the form of the excess of the loan interest value in the event that the loan interest value paid by the borrower to the Fintech Lending is greater than the loan interest value paid by Fintech Lending to the lender.


Value-Added Tax on Financial Technology Implementation
Value-Added Tax on Financial Technology Implementation



Value Added Tax (PPN) is imposed on the delivery of Financial Technology Implementation Services by Taxable Entrepreneurs (PKP). Financial Technology Implementation Services consist of:


  1. Provision of payment services, namely Electronic Money, Electronic Wallet, Payment Gateway, Switching, Clearing, Final Settlement and Fund Transfer Services;
  2. Implementation of investment settlements;
  3. Implementation of capital accumulation;
  4. Fintech Lending;
  5. Implementation of Investment Management;
  6. Online insurance product supply services;
  7. Market Support Services; and
  8. Digital financial support services and other financial service activities.

The basis for imposition of tax is in the amount of fees, commissions, merchant discount rates, administrative fees, excess interest value, or other rewards in any name and form received by the organizer.


Money in Electronic Money or Electronic Wallet media, including bonus points, top up points, reward points, and loyalty points, are goods that are not subject to VAT.


Exempted from the imposition of VAT, namely the delivery of Fund Transfer services within the same bank to customers holding current accounts, time deposits, certificates of deposit, savings, and/or other equivalent forms, are exempted from the imposition of VAT in accordance with the provisions of laws and regulations in the field of taxation.


Securities and financial instruments which are securities in accordance with statutory provisions include types of goods that are not subject to VAT.


Online insurance services provided by insurance companies are exempt from the imposition of VAT in accordance with the provisions of laws and regulations in the field of taxation.

Log In

Forgot password?

Forgot password?

Enter your account data and we will send you a link to reset your password.

Your password reset link appears to be invalid or expired.

Log in

Privacy Policy

Add to Collection

No Collections

Here you'll find all collections you've created before.