January 17, 2019 / 9:26 AM / 7 months ago

Indonesia eases rules for vehicle loans by multi-finance firms

JAKARTA, Jan 17 (Reuters) -

* Indonesia’s financial services authority (OJK) has removed downpayment requirements for vehicle loans extended by some multi-finance companies in a bid to boost economic growth, according to a statement on Thursday.

* The auto industry has a big share in Southeast Asia’s largest economy, and car and motorcycle sales are often used as key indicators of domestic consumption.

* Bambang W. Budiawan, the head of monitoring at OJK, said only “healthy” multi-finance companies with non-performing financing (NPF) ratio below 1 percent are allowed to offer zero percent downpayment for vehicle purchases with credit.

* Downpayments of at least 10 percent must be assessed by firms with a higher NPF ratio.

* Under previous rules, customers had to make a downpayment of at least 20 percent for motorcycle purchases and 25 percent for cars, similar to rules for banks. (Reporting by Tabita Diela; Editing by Richard Borsuk)

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