Legal Protection of Debtors in Online Loan Contract Default in the Digital Financial Era

Abstract

The development of online lending services as part of the digital financial ecosystem has increased public access to financing while simultaneously giving rise to various legal issues related to defaults and debtor protection. This study aims to analyze the forms of legal protection available to debtors who experience default in online loan contracts and to evaluate the effectiveness of the regulations governing such protection in the digital financial era. The research employed a qualitative approach using a normative juridical method supported by empirical data obtained through in-depth interviews with ten informants consisting of legal practitioners, academics, and users of online lending services. Data were collected through literature studies, interviews, and document analysis and were analyzed using descriptive qualitative techniques. The findings indicate that although Indonesia has established a relatively comprehensive legal framework, its implementation has not been fully effective. Major issues remain in the transparency of electronic contracts, imbalance in bargaining positions, collection practices that may create psychological pressure, vulnerabilities in personal data protection, and limited public understanding of dispute resolution mechanisms. Therefore, strengthening regulatory supervision, improving legal literacy, and ensuring balanced protection of the rights and obligations of debtors and creditors are essential to achieving justice in digital financial transactions.