Indonesia’s Investree plunges into crisis as licence revoked amid fraud allegation
Regulator’s action triggered by fintech’s failure to meet minimum equity; authorities set to freeze co-founder Adrian Gunadi’s bank accounts
[JAKARTA] Indonesia’s Financial Services Authority (OJK) has dealt a major blow to Jakarta-based peer-to-peer lending platform Investree Radhika Jaya, ordering the company to shut down all operations following a fraud allegation involving co-founder and former chief executive Adrian Gunadi.
While the fraud claim adds to the turmoil, the OJK’s decision was triggered by Investree’s failure to meet the required minimum equity of 7.5 billion rupiah (S$632,987), raising concerns about its ability to continue serving the public.
Now, the once-prominent fintech player must scramble to compensate employees, settle debts with lenders and borrowers, and hold general shareholder meetings within 30 days to set up a liquidation team.
Before the licence revocation, the OJK had instructed Investree’s management and shareholders to meet the minimum equity requirement, urging them to seek strategic investors and coordinate with the ultimate beneficial owner.
“OJK had previously issued warnings and imposed business restrictions, but Investree failed to implement necessary corrective actions,” the regulator said in a statement on Tuesday (Oct 22).
The OJK announced plans to collaborate with security forces and law enforcement to take legal action against Gunadi, who is reportedly out of the country. The agency is poised to freeze his bank accounts, trace his assets, and pursue all necessary steps to ensure accountability.
A NEWSLETTER FOR YOU

Friday, 8.30 am
Asean Business
Business insights centering on South-east Asia's fast-growing economies.
The Business Times has reached out to Investree for comment but has yet to receive a response.
Fintech rising star
Co-founded by Gunadi in October 2015, Investree was once a rising star in Indonesia’s fintech sector. It was among the pioneer peer-to-peer lending platforms operating in South-east Asia’s largest economy.
According to his LinkedIn profile, Gunadi is a former banker who started his career at Citi in 1998. He has extensive experience in retail banking, having worked at several Islamic banks including Permata Bank Syariah. He was managing director of retail at Muamalat Indonesia before resigning to co-found Investree in 2015.
Investree Radhika Jaya is the Indonesian entity of Singapore-based fintech group Investree Singapore.
In 2022, through Investree Singapore, the company acquired an 18.4 per cent stake in digital bank Bank Amar Indonesia from the Singapore-based Tolaram Group for an undisclosed amount.
In less than a decade, Investree successfully raised an impressive 22 trillion rupiah for lending, with total loan disbursements reaching 15 trillion rupiah.
It provides four lending products: invoice financing, working capital term loans, buyer financing, and micro productive loans.
It has built a robust network of 94,000 borrowers, predominantly consisting of small and medium-sized enterprises scattered throughout Indonesia.
The company has raised more than US$250 million in funding through nine rounds, including US$230 million in Series D funding from Qatar’s JTA International Holding in October last year, with additional participation from SBI Holdings. In 2021, Investree expanded its operations to Thailand and the Philippines.
Mounting debt woes, legal disputes
Investree’s financial troubles surfaced in mid-2023 when a wave of individual lenders in Indonesia raised concerns over the company’s failure to meet loan repayment obligations, accusing it of unlawful practices and mismanagement.
Concerns mounted after Gunadi was dismissed in January this year amid allegations of fraud and breach of contract, prompting legal action and resulting in his removal as director.
DealStreetAsia reported that Gunadi allegedly diverted Investree funds into his personal account while using the company as a guarantor for other businesses he owned.
He is believed to have ownership of two other companies, Putra Radhika Investama and Radhika Persada Utama, which operate separately from Investree Radhika Jaya.
In a statement earlier this year, Investree clarified that these entities were not affiliated with the company, and that it did not act as a guarantor for either of them.
Yet, the company has been grappling with an ongoing liquidity crunch, management issues, mounting bad loans, and lawsuits from lenders. In late August, it formed a caretaker team to oversee its daily operations with the support of the OJK.
The OJK has called on Investree’s shareholders, including its parent company Investree Singapore, to take the necessary steps to meet the minimum liquidity requirements. However, these actions remain unfulfilled.
Crackdown boosts confidence
The OJK’s decision to revoke Investree’s licence has been commended by the AFPI, Indonesia’s peer-to-peer lending fintech association, as a vital step towards fostering a healthier and more sustainable ecosystem amid the growing challenges facing the peer-to-peer lending industry in Indonesia.
“This can restore investor confidence about the industry. As an association, we continually remind our members of the necessity to adhere to compliant and prudent management practices,” Entjik Djafar, chairman of AFPI, told BT.
This is not the first time the OJK has intervened to halt the operations of a peer-to-peer lender over allegations of mismanagement.
In May, the OJK revoked TaniFund’s business licence following a liquidity crisis triggered by borrower defaults and the failure to repay lenders.
The company is contending with lawsuits and default issues involving approximately 128 investors, with the total value of defaulted investments amounting to around 14 billion rupiah.
TaniFund is a financial unit of the agritech firm TaniHub, backed by prominent investors including Alpha JWC Ventures and DFS Lab, a fintech accelerator funded by the Bill & Melinda Gates Foundation.
The peer-to-peer lending industry in Indonesia has seen significant growth in recent years, including during the Covid-19 pandemic, driven by increasing digital adoption, a large unbanked population, and the demand for alternative financing options. As at May 2024, such platforms lent about one-third of their loans to micro, small, and medium-sized enterprises in the country, according to the OJK.
However, post-pandemic, the peer-to-peer lending business has seen an increase in issues related to the rising number of bad loans.
The financial authority has implemented stricter regulations for these lenders. This includes increased minimum capital and equity requirements, with the aim to weed out weaker players and enhance overall financial stability in the sector.
Nailul Huda, director of the digital economy at the Center of Economic and Law Studies, said that the pandemic weakened borrowers’ abilities to repay loans.
“This situation is further exacerbated by the weak credit scoring systems used by peer-to-peer lending companies, resulting in a high incidence of defaults,” he noted.
Copyright SPH Media. All rights reserved.