BI Decides To Extend Incentives For 0 Percent Of Motorized Vehicles By 2025

Motorized vehicle (Photo: Antara)

JAKARTA - Bank Indonesia (BI) has decided to extend several macroprudential easing policies until December 31, 2025. One of these policies is the easing of the down payment provisions for motor vehicle loans or financing to 0 percent.

BI Governor Perry Warjiyo explained that this easing aims to encourage credit growth and support sustainable economic growth. In addition, the down payment incentive (DP) for property loans of 0 percent was also extended.

"Bank Indonesia continues the provisions of Loan to Value / Financing to Value (LTV / FTV) on property loans/financing at most 100 percent and Bank Motor Vehicle Loans / Financing at the lowest 0 percent until December 2025," wrote BI's announcement on its official Instagram, Thursday, October 24.

As previously, the policy will end on December 31, 2024. Where the policy applies to all types of new properties and motorized vehicles.

Previously, BI recorded credit growth in September 2024 reaching 10.85 percent (yoy). In terms of supply, strong credit growth is supported by maintained interest in lending, continued reallocation of liquid assets to credit by banks, and support for Bank Indonesia's Macroprudential Liquidity Policy (KLM).

Meanwhile, until the second week of October 2024, Bank Indonesia has distributed KLM incentives of Rp256.5 trillion to state-owned bank groups of Rp119 trillion, state-owned banks of Rp110.2 trillion, BPD of Rp24.6 trillion, and KCBA of Rp2.7 trillion.

In addition, the resilience of the financial system is well maintained. Bank liquidity remains adequate, as reflected in the ratio of Liquid Equipment to Third Party Funds (AL/DPK) in September 2024 of 25.40 percent. Then the banking capital adequacy ratio (CAR) in August 2024 was recorded at 26.69 percent and was classified as strong in absorbing risks and supporting credit growth.

Meanwhile, the banking Non-Performing Loan (NPL) ratio in August 2024 was maintained low, at 2.26 percent (gross) and 0.78 percent (neto).