Speaker
Description
This study analyzes the behavioral dynamics among borrowers, lenders, and joki within Indonesia's online lending ecosystem, particularly on Facebook. The research aims to understand how economic necessity, information gaps, and the COVID-19 pandemic influence interactions in this digital space. A key problem addressed is the proliferation of both legal and illegal lending on social media, which exposes users to predatory practices and debt cycles. This study is novel in its mixed-methods approach, uniquely combining netnographic analysis of 332,161 words from 18 Facebook groups with econometric modeling of 680,000 household records from SUSENAS (2022-2023). It specifically highlights the pivotal, yet underexplored, role of joki and distinguishes behavioral shifts pre- and post-pandemic.
Findings indicate that borrowers, driven by urgency, often prioritize quick access over safety, aligning with prospect theory. Post-pandemic, online discussions evolved from focusing on repayment difficulties to concerns about digital security and identity verification. Illegal lenders were found to use predatory tactics like hidden fees and fake regulatory logos, while legal lenders competed by lowering verification standards. Joki emerged as critical intermediaries who exploit information asymmetry, frequently promoting illegal loans for commissions and facilitating data fraud. The econometric model identified key predictors of online loan usage: younger age, bank account ownership, multidimensional poverty, and food insecurity (all positive effects), while urban residence had a negative effect.
In conclusion, the pandemic amplified reliance on online loans but also increased user wariness. Joki significantly amplify systemic risks by connecting vulnerable borrowers with unscrupulous lenders. Policy recommendations include regulating joki activities, enhancing public digital financial literacy, and expanding access to formal financial services to address the underlying drivers of this market.
Keywords: online loans, netnography, loan joki, pandemic impact, predatory lending.
