BANK INDONESIA’S CIRCULAR LETTER ON DOWN PAYMENT REQUIREMENTS FOR MOTOR VEHICLE PURCHASING LOANS

May 01, 2012

On 15 March 2012, Bank Indonesia issued Circular Letter No. 14/10/DPNP on the Implementation of Risk Management by Banks providing Housing Loans and Motor Vehicle Loans (“SEBI 14 of 2012”).
 
According to SEBI 14 of 2012, banks providing motor vehicle loans are required the following down payments (payments in advance) for motor vehicle purchases:

a. the vehicle must have a license issued by the competent authority for transporting people or goods; or

b. the motor vehicle is to be purchased by an individual or legal entity holding a certain business license issued by the competent authority to be utilized to support the operational activities of the business.
 

1. at least 25% for purchasing twowheeled motor vehicles;
2. at least 30% for purchasing fourwheeled motor vehicles for nonproduction purposes;
3. at least 20% for purchasing four or more wheeled motor vehicles for production purposes, with the following requirements:

The above percentages are to be calculated based on the purchase price of the motor vehicle to be financed by the bank.