Indonesia P2P Lending Defaults: Why Seniors Are More Vulnerable

As of December 2025, the total P2P loan outstanding on Indonesia's lending platforms reached Rp82.98 trillion. This figure is up from Rp72.48 trillion in December 2024, a growth of 14.5 percent in one year.

Of that total, the 19 to 34 group holds the largest share at Rp41.49 trillion, or around 50 percent of total active loans. The 35 to 54 group follows with Rp37.59 trillion, or 45 percent. Meanwhile, the over-54 group holds Rp3.71 trillion, and the under-19 group holds Rp277 billion.

But one important point is often missed. Young people are indeed the largest borrower segment, but that does not mean their loan per person is the largest.

Of the 26.1 million active P2P loan accounts in Indonesia, 15.58 million belong to the 19 to 34 group. The number of accounts is large, so the total loan value is also large. However, the average loan per account in this group is only Rp2.66 million.

That figure is smaller than the 35 to 54 group, whose average loan reaches Rp3.98 million per account. Even the over-54 group has a higher average loan at Rp4.27 million per account.

So young people do not always borrow in large amounts. They appear dominant because the number of borrowers is simply very high.

The main problem for P2P lending in 2025 is not only about who borrows the most, but about deteriorating loan quality.

Throughout 2025, total P2P loan outstanding rose 14.5 percent. But total bad credit, or loans more than 90 days overdue, rose from Rp1.50 trillion to Rp2.15 trillion. That is a 43.1 percent increase in a year. In other words, loan quality is deteriorating three times faster than the market is growing.

Broken down by age group, bad-credit growth occurred in almost every segment, but at different speeds.

In the 19 to 34 group, bad credit rose from Rp779.7 billion to Rp1.03 trillion, an increase of 32.2 percent.

In the 35 to 54 group, bad credit rose from Rp622 billion to Rp905.9 billion, a higher increase of 45.7 percent.

The most striking is the over-54 group. Bad credit in this segment rose from Rp94.9 billion to Rp201.5 billion, a surge of 112.4 percent in a year. This is the highest bad-credit growth rate among all adult age groups.

Meanwhile, the under-19 group also recorded a sharp rise, from Rp2.65 billion to Rp6.9 billion. In percentage terms, the increase reaches 160 percent, though the nominal value is still far smaller than other age groups.

From this, it is clear that young people do contribute the largest bad-credit value in nominal terms. But the fastest bad-credit growth is in fact happening among older and underage segments.

To see which segment is truly the most problematic, absolute numbers alone are not enough. We need to compare bad credit against total loans within each age group. This is what is called the bad-credit ratio, or TWP90 (the rate of default beyond 90 days).

Here, IDN Research Institute uses two different metrics to read the bad-credit data, because each answers a different question.

The first metric is the share of total national bad credit, namely what percentage of an industry's total bad credit comes from a given segment. The formula is:

Share = (Segment X's bad credit ÷ Total national bad credit) × 100

This metric is what the OJK uses when it states that 48.65 percent of bad credit comes from borrowers aged 19 to 34 (from March 2026 data, presented in the OJK April 2026 RDK Answer Sheet). This metric is relevant for measuring systemic impact: which segment contributes the most to the industry's total bad-credit burden.

The second metric is the bad-credit ratio within the segment itself (TWP90), namely what percentage of loans within a given segment have entered the bad-credit category. The formula is:

Ratio = (Segment X's bad credit ÷ Segment X's outstanding) × 100

This metric answers a different question: which segment has the most problematic proportion of loans? This metric better reflects credit quality per segment, regardless of how large the loan volume is.

Both metrics are calculated from the officially published OJK LPBBTI Statistics for December 2025. The results for December 2025 are as follows:

The calculation of the national bad-credit share from December 2025 data yields 48.1 percent for the 19 to 34 group, consistent with the official OJK statement citing 48.65 percent from March 2026 data. The small difference is reasonable given the different data periods.

For the trend analysis across 2025, the bad-credit ratio was calculated monthly using monthly data from January through December 2025, then averaged. This method was chosen because the available data is the loan stock at month-end, not the inflow of new defaults, so the average monthly ratio is the most honest approximation given the data limitations.

As of December 2025, the bad-credit ratio for the 19 to 34 group stood at 2.48 percent. This is almost the same as the 35 to 54 group at 2.41 percent and the under-19 group at 2.49 percent.

The highest is in fact the over-54 group, with a bad-credit ratio of 5.44 percent. This ratio is more than double that of any other age group. It means that for every Rp100 in loans held by seniors, around Rp5.44 has already entered the bad-credit category. So in proportional terms, loans in this age group are far more problematic than in the productive-age segments.

And this is not a one-month anomaly. Based on monthly data throughout 2025, the senior bad-credit ratio consistently sat above other segments every month, from 3.09 percent in January to 5.44 percent in December, with an average of 4.53 percent across the year. By comparison, the 19 to 34 group averaged 2.13 percent and the 35 to 54 group 2.09 percent.

This trend reinforces the finding that the senior problem is not merely a fluctuation but a pattern that worsens systematically across the year.

However, the high bad-credit ratio among seniors also needs to be read more humanely. At an age when the room to add income grows narrower, many older people still have to cover living needs, healthcare costs, and sometimes even support their family.

When income is no longer as flexible as in the productive years, one small loan can feel heavy when it comes due. On top of that, SNLIK 2025 data shows that the 51 to 79 age group is among those with the lowest financial literacy and inclusion, so their ability to read the risks of digital lending is not necessarily as strong as that of younger segments.

So the high senior bad-credit ratio is not merely about default. It is a sign that some older people enter P2P lending not because they have many options, but because their financial choices have in fact grown more limited.

This matters because public discussion has so far centered on young people and P2P loans. Yet the data shows there is another segment whose trend also deserves serious attention.

Although the young segment's bad-credit ratio is not the highest, this age group remains a focal point because they are the most exposed to P2P lending, including illegal lending.

Data from the Illegal Financial Activity Eradication Task Force (Satgas PASTI) recorded 18,633 reports related to illegal P2P loans from 1 January to 30 November 2025. It should be noted that this figure represents reports received, not the actual number of victims, so less digitally literate segments may report less even if they are still affected.

Of those total reports, the 26 to 35 group recorded the highest number at 7,211 reports, or 38.7 percent. The 16 to 25 group came second with 6,533 reports, or 35 percent.

Combined, nearly three out of four illegal P2P loan reports come from people under the age of 36.

This shows that the risk to young people exists not only in legal P2P lending recorded in OJK data but also in illegal lending that is harder to supervise and often more dangerous.

The OJK's Chief Executive for the Supervision of Financial Services Business Conduct, Education, and Consumer Protection, Friderica Widyasari Dewi, has explained that illegal P2P loans are often chosen because the process is fast and the requirements are not complicated. For younger people, the push to borrow is also frequently tied to consumer desires.

The problem is that this convenience comes with major risk. Legal P2P lenders still have a verification process for prospective borrowers. Illegal lenders, by contrast, often disburse funds without adequate verification, then charge high interest when the borrower is unable to pay.

Even though by ratio they are not the worst, the 19 to 34 group still needs special attention.

First, because of scale. This group's bad credit reaches Rp1.03 trillion, higher than both the 35 to 54 group and the over-54 group. So its impact in terms of the number of people affected remains very broad.

Second, this age group is usually in the early phase of financial life. Many are just starting work, building a career, or earning income that is not yet stable. Some also work in the informal sector or the gig economy, where earnings can change from month to month.

When P2P loan installments begin to pile up and income is unstable, the risk of default becomes higher.

Third, the impact can be long-lasting. Bad credit at a young age can affect credit history and the SLIK score. As a result, access to more productive financial products such as mortgages, vehicle loans, or business loans can be hindered in the future.

So the issue is not simply that young people are more wasteful or more careless. The problem is more structural: they use P2P loans heavily, sit in a vulnerable financial phase, and are the most exposed to illegal lending.

For borrowers, the most basic step is to make sure the P2P lending platform they use is registered and licensed by the OJK. Do not be tempted only because the process is fast or disbursement is easy.

Borrowers also need to look at the total cost of the loan, not just the nominal monthly installment. Interest, admin fees, and late penalties can make the total payment far larger than the initial estimate.

For legal P2P lending platforms, this data is a signal that the repayment-capacity assessment process needs strengthening. Bad-credit growth that far outpaces outstanding growth points to a risk that needs to be managed more seriously.

Platforms can also make cost information easier to understand, give early warnings to borrowers who begin to show risky patterns, and provide access to financial education or counseling.

For regulators, a focus on young people is important but not enough. The over-54 group records the highest bad-credit ratio and very sharp bad-credit growth. The under-19 group also needs attention, since their access to P2P lending should be very limited.

This means supervision needs to look at all age groups, not just the popular narrative about young people and P2P loans.

The December 2025 data shows that Indonesia's P2P lending problem cannot be read solely as the problem of a single generation.

The 19 to 34 group does account for nearly half of bad credit. But they also hold half of the total active loans. By ratio, their default rate is not far from other productive-age segments.

What is more concerning is the deterioration of overall loan quality. Bad credit grew far faster than the growth of total lending. The over-54 group even shows the highest bad-credit ratio and very sharp growth. At the other end, the under-19 group should not have broad access to P2P lending, yet the data is there.

So the real story is not only about young people trapped in P2P loans. The bigger story is about a digital lending system growing fast while its repayment quality begins to weaken across many age groups.

Young people still need protection because of their large numbers and because the impact of bad credit in the productive years can be long-lasting. But if public discussion stops at "Gen Z and millennials have a P2P loan problem," we risk missing other danger signals that are no less important.

Today's P2P lending problem is an alarm for borrowers, platforms, and regulators to read risk more completely before it grows larger than it appears on the surface.