E-signature provider VIDA cofounder and CEO Sati Rasuanto said that while the country had several existing regulations on data protection, the PDP bill would serve as the encompassing regulation.

“Digital identity providers welcome this law because it can increase users’ trust, and trust is the basis for our industry to grow,” she said during an online discussion on Wednesday.

The bill provides rules on the use of personal data and penalties for infractions. Drafted and proposed by the government in 2014, the bill was listed as a priority last year, but deliberations in the House of Representatives have been slow, and stages of the process have been postponed several times. The government hopes to pass the bill this year.

E-signature providers use personal identification information, big data and encryption technology to guarantee the authenticity of a signature without in-person verification. Such signatures can be used for online peer-to-peer (P2P) lending and online investment, among other applications.

A 2019 Microsoft and IDC Asia report found that 56 percent of respondents in Indonesia would switch to another online service if they had trust or privacy concerns. Meanwhile, 37 percent would decrease their use of the digital service and 33 percent would stop using the service altogether.  

“Apps that neglect their users’ data protection need to worry because consumers will leave,” said Center of Economics and Law Studies (CELIOS) director Bhima Yudhistira during the discussion. “While consumers will try different digital services, they will ultimately choose the ones that are trusted.”

He quoted a Forrester Consulting study that found that digital signatures could create up to 30 percent gains in cost efficiency and 35 percent higher revenue for companies as people became more likely to take part in online transactions if e-signature features were available.

“The current PDP draft bill is more comprehensive. It has included legal sanctions for companies that fail to protect user data,” Bhima said. “Digital ID industry growth will increase significantly after this law is passed.”

Big-name local technology companies experienced data breaches in 2020, including e-commerce firms Tokopedia and Bhinneka and fintech firm Cermati. Government institutions also experienced high-profile data leaks in 2021, including the Indonesian Child Protection Commission (KPAI).

Read also: More government agencies suffer cyberattacks

Indonesian Regtech and Legaltech Association (IRLA) chairman Marshall Pribadi said the PDP bill had adopted the same principles found in the European Union’s General Data Protection Regulation (GDPR), which he said had been “tested and proven”.

“Industry players are supportive of this regulation,” he told The Jakarta Post in a phone interview on Thursday. “The content of the PDP bill and the obligations stated in it are proper and fair.” 

Marshall, who is also the CEO of e-signature service provider PrivyID, added that the COVID-19 pandemic had accelerated the adoption of e-signature services. His company’s corporate customers had risen to 700 in 2020 from 200 in 2019.

Read also: Indonesia’s e-signature start-ups gain traction amid pandemic

He said integrating digital signatures into a company’s operations entailed a wider digital transformation, including the establishment of web portals and investment in digital infrastructure such as WiFi and computers.  

“[The need for an] infrastructure upgrade is the most common problem our clients face, especially for bigger companies that need to allocate a bigger budget for it,” Marshall added.

Aside from data protection, e-wallet DANA CEO Vincent Iswara said consent management should be included in the PDP bill, including ways for users to give, withhold or retract their consent to their data’s use.

“I am sure that Indonesia’s data management will be much more mature and developed,” he said. “I believe users’ trust will increase, hence [online] transactions will go up also.”