Online Gambling Crisis in Indonesia: Understanding Causes and Implementing Solutions

Online gambling, or "judol," has become an increasingly alarming phenomenon in Indonesia. The widespread availability of internet access has facilitated the exposure of the population to online gambling advertisements, often disguised as harmless gaming applications. Users who initially engage out of curiosity can easily become trapped in gambling games that promise quick winnings, potentially leading to addiction and ensnaring individuals in a cycle that is difficult to break.

A 2023 Populix survey titled "Understanding the Impact of Online Gambling Ads Exposure" revealed that 84% of internet users in Indonesia frequently see online gambling advertisements on social media platforms such as Instagram, YouTube, and Facebook. These ads are often promoted by influencers with extensive audiences, making them challenging to avoid and increasing the risk of addiction.

Meanwhile, the Association of Internet Service Providers in Indonesia (APJII) reported that by 2024, the number of internet users in Indonesia had reached 221,563,479 out of a total population of 278,696,200, with a high internet penetration rate of 79.5%. This figure means that nearly 80% of the population is at risk of exposure to online gambling content, making it an urgent national issue.

With nearly 80% of the population potentially influenced, Indonesia is now facing an online gambling crisis. Its impact is not only on individuals' finances but also on the social and economic structure of society. Addressing this issue requires prompt action and comprehensive solutions to protect society from the increasingly pervasive dangers of online gambling.

Financial Literacy Challenges and Economic Issues Are Major Contributors to the Gambling Menace

One of the primary causes of the online gambling emergency is the lack of financial literacy among the population. Despite increasing financial inclusion—access to financial services—there remains a significant gap in understanding financial management and security risks that need to be addressed. This leads many individuals to be unprepared to face various financial risks, including those associated with online gambling.

In addition to financial literacy challenges, economic factors also play a crucial role in this crisis. Although data from the Ministry of Finance as of March 2024 shows a decrease in Indonesia's poverty rate to 9.03% from 9.36% the previous year, approximately 25.22 million people still live below the poverty line, defined at around Rp 550,000 per month. This reduction in poverty rates does not fully address the existing economic disparities.

Furthermore, World Bank data reveals that in 2023, the aspiring middle class (AMC) increased to 49%, while the middle-class group decreased to 17%. This indicates a significant shift in the economic structure of society, with many people finding themselves in financially precarious situations.

Bhima Yudhistira Adhinegara from the Center of Economic and Law Studies (Celios) adds that around 40% of the middle class is at risk of falling into poverty due to economic burdens that exceed their income. In this context, online gambling is often viewed as a shortcut to making money quickly, despite its high risks.

Judol, particularly gambling types like slot machines and the term "gacor" (easy jackpot), have gained concerning popularity. Drone Emprit data indicates that Indonesia has the highest number of slot gambling players in the world, reaching 201,122 players. The term "gacor," often used by online gambling sites, further promotes the idea that large winnings can be easily obtained, leading more people to engage in gambling. This is because a player can potentially gain multiple-fold profits in a single win.

Furthermore, findings from the Jakpat survey show that about 6.1% of respondents are willing to borrow money from friends or family for gambling purposes, while 5.9% use online loans (pinjol) to fund their gambling habits. A majority, 81.2%, admit to using their personal income for online gambling. These statistics highlight the profound financial impact of online gambling on individuals and emphasize the urgency of addressing this issue comprehensively.

Negative Impacts of Online Gambling on Society

Overall, the phenomenon of online gambling in Indonesia highlights shortcomings in financial literacy and profound economic instability. Online gambling has caused widespread negative effects on society, including debt issues, personal data breaches, and fraud.

The escalating debt, particularly through online lending platforms (pinjol), has become a serious controversy. The Financial Services Authority (OJK) reports total financing through pinjol reached Rp62.17 trillion as of March 2024. While pinjol have benefited businesses greatly, many individuals, especially from the middle class, are compelled to rely on them to meet financial needs worsened by gambling addiction. This leads them to seek additional funds for gambling, exacerbating financial problems and resulting in debts that are hard to repay.

Additionally, personal data breaches pose a serious problem. Indonesia is now among the top ten countries for data breaches in 2024, according to Surfshark. Many online gambling sites operate without proper authorization and fail to adequately protect user data. This puts personal information like identity data and financial transactions at risk of falling into irresponsible hands, increasing the chances of fraud and data misuse.

Fraud is also prevalent in online gambling. Many gambling operators promise quick profits that often remain unrealized, deceiving players by taking their money without delivering the promised winnings. These scams may involve manipulating game outcomes or misusing personal data for illegal activities.

Addressing these issues requires comprehensive measures such as educating about gambling risks, strengthening regulations, and safeguarding personal data.

Solutions for Combating Online Gambling in Indonesia

The government, through the Ministry of Communication and Information Technology (Kominfo), has made significant strides by blocking over 2,625,000 online gambling sites as of July 2024. This action is anticipated to reduce the flow of money into online gambling by up to 45 trillion rupiah. However, this is only part of the comprehensive solution needed.

To effectively address the issues of online gambling and online loans and to change public behavior, a collaborative effort from all sectors is essential for building a financially educated and independent society. Here are some potential solutions:

1. Improving Financial Literacy

Strong financial literacy helps individuals understand the risks and benefits of personal financial management. Enhanced financial literacy enables people to make informed financial decisions and avoid the lure of shortcuts like online gambling. Expanding education on money management, investing, and debt management is crucial for developing a better understanding of the associated risks.

2. Strengthening Social Media Platform Regulations

Social media platforms play a vital role in regulating and restricting online gambling content on their channels. Technology companies should enforce stricter community policies and increase oversight of violating content. This includes preventing the promotion of online gambling and ensuring that such content is not easily accessible to users, particularly children and teenagers.

3. Industry Collaboration for a Healthy Financial Ecosystem

According to the Financial Transactions Reports and Analysis Center (PPATK), the money flow from online gambling reached Rp 327 trillion in 2023. Additionally, respondents noted that those involved in online gambling often use e-wallets for transactions (Populix, 2023).

This highlights the responsibility of financial industry players, including e-wallet providers and financial institutions, to limit financial access for online gambling. Government agencies, Payment Service Providers (PSPs), Payment System Infrastructure Providers (PSIPs), associations, and all relevant stakeholders must work together to promote financial literacy, support strict regulations, and ensure a secure and effective digital financial ecosystem.

4. Community Involvement and Support from Family and Friends

The public can report online gambling content through various channels, such as the email address pse.kominfo.go.id, the aduankonten.id website, or the WhatsApp number 08119224545. Furthermore, support from family and friends is crucial for assisting individuals who are at risk of falling into online gambling.

Despite ongoing efforts, combating online gambling and online loans still faces challenges, particularly regarding underlying economic issues. Factors such as job availability, access to education, and improvements in the social security system are important for addressing the root causes.

With a collaborative approach among the government, industry, and society, it is hoped that we can accelerate the eradication of online gambling and online loans, thereby supporting the development of a financially healthy digital community.