Indonesia Launches Streamlined Online Business Licensing Platform In Bid To Attract More Investments

Indonesia launched the streamlined version of its online single submission (OSS) system on Monday, 9 August, a website that processes business licenses, which the government hopes can make it more competitive in attracting foreign investors into the country.

President Joko Widodo
Credit: Reuters

The new OSS website uses a risk-based approach to processing investment proposals. Businesses deemed as "low risk" can get instant approval and will only need to obtain a registration number (NIB), while those considered as "high risk" will require additional documentation, such as an Environmental Impact Analysis.


"We want our investment climate to become more conducive…to increase investors' confidence, to create jobs and become a solution to the problem of rising unemployment because of the pandemic," said President Joko Widodo during the launch event.


The website is reportedly part of Widodo’s plan to increase business investments amid the pandemic, which started with the controversial Job Creation Law passed last year, as reported by Reuters. The law drew protests from various groups, including trade unions and environmentalists, who argued that its passing hurts labour protection and takes land away from farmers and indigenous groups.


"This is a highly significant reform in licensing," he added. "Integrated, fast and simple business licensing is an instrument that determines our competitiveness in attracting investment."

Credit: The Jakarta Post

This is not President Widodo's first attempt at digitizing investment applications, but the old system still took months, if not years, to process proposals in certain sectors. This new OSS looks to solve this exact problem, essentially cutting the red tape and giving the investment ministry greater authority to intervene when authorities take too long.


Investment Minister Bahlil Lahadalia said that the website, which was developed by telecommunication firm Indosat, eliminates application costs for businesses of up to 5 billion rupiah (US$347,705).


Indonesia, Southeast Asia's largest economy, managed to recover in the second quarter of this year, posting a 7.07% gross domestic product growth and an increase in investment of 7.54%. Analysts, however, warn that the economy could once again face some setbacks due to a resurgence in COVID-19 cases

Written by Kyle Chua



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