Indonesia's Financial Services Authority urges cross-agency digitisation of land documents to accelerate bank lending

Indonesia's Financial Services Authority (OJK) published a press release calling for faster and better-aligned digitisation of land documents across agencies to speed up banks’ credit disbursement processes while maintaining prudential standards. The message was delivered by OJK’s Chief Executive for Banking Supervision at a national focus group discussion in Jakarta involving the Ministry of Agrarian Affairs and Spatial Planning/National Land Agency (ATR/BPN), parliament, banks, banking associations, notaries and land deed officials. The forum was positioned as a cross-sector coordination platform to align implementation of the Electronic Land Certificate (Sertipikat Tanah Elektronik) and Electronic Mortgage Right (Hak Tanggungan Elektronik) in the banking industry. It was used to socialise the regulatory and operational framework for digital land documents, seek clarity from ATR/BPN on data access for verification and prevention of duplicate collateral, align the gatekeeper role of notaries and land deed officials in ensuring document authenticity and legal certainty, and gather industry feedback on operational obstacles. OJK’s study assessed that Sertipikat-el and HT-el could accelerate credit processes and strengthen banking accountability, but flagged challenges including inconsistent understanding among banks of legal validity and usage procedures, differing verification standards across banks, incomplete system integration to prevent duplicate collateral, and the need to strengthen service level arrangements and helpdesk support. OJK, ATR/BPN and the House of Representatives’ Commission II agreed to continue coordination and cooperation to improve the effectiveness, efficiency and security of land-document digitisation as it relates to bank collateral and lending.