The Jakarta Post
Education-focused peer-to-peer lender Pintek launched on Thursday a fast lending product to help students and parents get funds during the pandemic.
The product, called Pintek Instant, affords borrowers access to loans of up to Rp 5 million (US$339) with an hour approval time and repayment in installments over a period of up to three months.
The company’s CEO, Tommy Yuwono, said the COVID-19 pandemic had resulted in parents getting pay cuts or furloughed, making it hard for them to pay for their children’s school needs.
“This product is to help students pay for tuition, books, gadget and phone credit, among other things, to help them learn from home during the pandemic,” he said in a press briefing.
He went on to say that the company aimed to have 5,000 new borrowers using the product in the next six months.
However, Tommy said the product could only cater to partner schools, as Pintek would transfer the money directly to the education institution.
“We do not want Indonesia’s students to get left behind in school because of this pandemic, that is why we want to ease payments for education,” he said.
The company reported that it had disbursed Rp 70 billion in loans to more than 3,000 borrowers since its establishment in 2018.
In September, Pintek said its nonperforming loan (NPL) ratio was around 0.1 percent, well below the overall NPL ratio in the fintech industry, which increased to 7.99 percent in July as a result of the decline in income among borrowers.
Tommy went on to say that Pintek had tightened its credit scoring system and offered loan restructuring to prevent bad loans. So far, fewer than 10 borrowers had asked for the restructuring, he added.
The Indonesian Fintech Peer-to-Peer Financing Association’s (AFPI) legal and compliant handling manager Tiar Sidabutar said that, while the NPL had increased, the number of lender transactions has risen by 12 million from July to August, signaling market trust in P2P lending.
“There are still only a few players in fintech for the education sector, hopefully we will see more companies enter the scene and more borrowers getting to know this type of financial service,” he said.