Verification platform Sumsub and Indonesian fintech industry body Asosiasi FinTech Indonesia (AFTECH) have jointly released a whitepaper calling on payment providers to adopt continuous, technology-enabled compliance as Indonesia’s regulatory framework undergoes a fundamental restructuring.

The whitepaper, titled From Entity to Activity-Based Regulation: What Payment Providers in Indonesia Need to Know, arrives as Bank Indonesia’s BI Regulation 10/2025 — which took effect in March 2026 — shifts compliance obligations away from corporate structure and toward the specific activities a provider conducts. Licensing, documentation standards, and capital requirements are now calculated based on the nature of each transaction activity, such as issuing e-money, operating a payment gateway, or facilitating fund transfers.

The Stakes: A $110 Billion Market With a Fraud Problem

Indonesia’s payment infrastructure market was valued at US$110.69 billion in 2025 and is projected to reach US$294.85 billion by 2031, growing at a compound annual rate of 17.74%. But scale also brings exposure: Sumsub’s Global Fraud Index 2025 ranks Indonesia as the second least protected country against fraud out of 112 nations. The country also posted the second-highest fraud rate in APAC in 2025, with 5% of approved applicants found to be linked to fraud networks.

Penny Chai, Vice President for APAC at Sumsub, said the shift demands more than a compliance checklist.

“Point-in-time controls simply cannot keep pace with persistent levels of fraud that are increasingly being strengthened with AI. What payment providers need to operate with confidence is a multi-layered defense that works as a continuous system, connecting identity verification, transaction monitoring, and AML screening across the entire customer lifecycle.”

Three Trends Reshaping Indonesian Payments Compliance

The whitepaper identifies three defining shifts for the sector. First, the transition to continuous compliance — replacing fragmented, point-in-time checks with an integrated verification lifecycle that links onboarding logic to ongoing monitoring. This is designed to maintain automatic audit trails that satisfy both Bank Indonesia and the Otoritas Jasa Keuangan (OJK).

Second, low-friction onboarding design. Under activity-based verification, checks are calibrated to the risk level of each payment activity, allowing providers to fast-track low-risk users while applying deeper scrutiny to higher-risk transactions.

Third, the whitepaper flags behavioural intelligence as a critical shield against mule networks. With Sumsub’s research finding that 1 in 4 individuals in APAC have been personally targeted for mule recruitment, the report argues that threshold-based rules are no longer sufficient. Behavioural analysis and network-based detection are now needed to identify micro-transaction layering and complex account schemes.

AFTECH: Compliance as the Foundation for Growth

Budi Gandasoebrata, Vice Chairman II of AFTECH, said the regulatory shift represents a meaningful milestone for the sector.

“Bank Indonesia’s shift to activity-based regulation marks an important milestone in strengthening the foundation of Indonesia’s payment ecosystem. Compliance done well remains the foundation on which a trusted and inclusive digital economy can sustainably grow.”

Sumsub also used the whitepaper to advocate for greater regional regulatory harmonisation, noting that inconsistent definitions for digital wallets and e-money across APAC markets add friction for SMEs and undermine the effectiveness of digital trade agreements.

The full whitepaper is available at sumsub.com.