Determinant Factors Fintech Growth of Indonesia Gross Domestic Product

Abstract

The development of fintech is part of Indonesia's economic growth, one part peer-to-peer lending fintech is the focus of this study within the fintech space. Fintech applications offer an alternative to traditional funding sources for addressing the requirements of the Indonesian populace. Thus, the purpose of this study is to examine the internal influences on economic growth of fintech companies in Indonesia. The study's premise is that the dependent variable, Indonesian GDP, is influenced by the independent variables, net interest margin, yield on earning assets, capital ratio, company scale, cost to income ratio, interest income share, and gender. The novelty of research is that there is a negative correlation but a significant effect between the Net Interest Margin variable of peer-to-peer lending fintech companies and Indonesia's GDP. Fintech peer-to-peer lending companies charging high fees to borrowers so that the risk of high loans as a result decreases borrower demand not only that if the interest is high, but it will also have an impact on default by the community so that the default rate on fintech companies in Indonesia is high. If there is bad credit, then it greatly affects economic conditions in Indonesia. Peer-to-peer lending fintech companies with good asset management, operational management, and loan interest income management will help economic growth in Indonesia.