JAKARTA (TheInsiderStories) – Indonesian Financial Services Authority (FSA) loosen the down payment of car and motorcycle to zero percent at the leasing company, from earlier as much as 5 percent. But observer said, the policy has give limited impact to the economy.
The new rules contained in Number 35/POJK.05/2018 allowed multi finance companies with a net non-performing financing (NPF) lower or equal to 1 percent to be able to apply motorized vehicle financing with down payment zero percent.
Meanwhile, for financial companies that have a net NPF higher than 1 percent or equal to 3 percent can provide financing with a down payment of at least 10 percent. Then, the companies with net NPF between 3 to 5 percent can provide financing with the lowest DP of 15 percent. If the finance company has a net NPF above 5 percent, then the down payment can be given in the range 20-25 percent.
In response to the new policy, the economist for Development of Economics and Finance Bhima Yudhistira Anggana rated, the impact of this rule will still be limited in the country cause the people’s purchasing power is still low.
In addition, he saw the NPF of multi-finance industry still above 3 percent. On average, NPF financing companies in the January-November period recorded 3.1 percent. This NPF become a concern in 2019, because the finance company is still in the consolidation stage to clear up the bad credit.
“Therefore, finance companies will be very selective in choosing customers who can be given a zero percent facility,” he told TheInsiderStories.
Furthermore, Anggana revealed the ratio of operating costs to operating income multi-finance is too high as of November 2018, reached 80.46. Therefore, finance companies with small capital will first examine before implementing the policy.
Otherwise, Director of PT Mandiri Tunas Finance (MTF) Harjanto Tjitohardojo stated, the new policy opens an opportunities for finance companies with low NPF, including the company with NPF 0.74 percent.
“There are not many finance companies that can provide a down payment of zero percent,” said the director.
Therefore, he continued, MTF is reviewing a financing scheme that matches to the new policy. So far, the lessor run the car ownership program with a down payment of 5 percent.
Whereas, Tjitohardojo thought the impact of the rule will be happened gradually because finance companies must consider the quality of credit before providing financing the zero percent program.
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