LEGAL PROTECTION FOR CONSUMERS IN EQUITY-BASED CROWDFUNDING ACTIVITIES IN INDONESIA

Abstract

Financial Technology has developed very rapidly in recent years. Among the products of its
creation is crowdfunding. Crowdfunding itself is defined as the practice of funding a project or
business by collecting small amounts of money from large numbers of people, and usually via
the internet. One form of crowdfunding that is currently in demand in several parts of the world
is Equity-based Crowdfunding. Equity-based crowdfunding is a funding transaction in which
a fundraising company offers a share of shares in the company as compensation for the
investment made through the platform, namely the website. There is no regulation on this
activity in Indonesia. However, if the future constitution regarding this matter will be made,
one thing that should be emphasized will be consumer protection. Regulators, in this case, must
provide protection by considering the nature and purpose of crowdfunding itself to make it
easier for new companies to raise funds without going through a mechanism that consumes a
high value at a fairly long process.