REPUBLIKA.CO.ID, JAKARTA -- Vice President Jusuf Kalla considered it was risky to apply zero percent down payment (DP) policy for vehicle financing for cars and motorbikes. He reminded that the policy could cause a hike in bad debts.

"It's better not (to be implemented)," said Vice President Jusuf Kalla to reporters in Jakarta, on Monday (Jan 14).

The Vice President admitted that a zero percent DP loan could make it easier for people to own vehicles. On the other hand, people might have difficulties to pay installments on the loan.

"If there is a high risk, then the one who will work are debt collectors," he said, interspersed with jokes to the reporters after giving a speech at the National Seminar and Dialogue on "Indonesian Labor Readiness".

Previously, the Financial Services Authority (OJK) cut down on down payment obligations on finance companies (leasing / multifinance) to channel financing of motorized vehicles both cars and motorbikes. The provision of zero percent DP loan is stated in the OJK Regulation Number 35 / POJK.05 / 2018 which was published on December 27, 2018 and published on the official website of OJK on Thursday (Jan 10).

In the previous rules, OJK set the down payment obligation for motorcycles and cars at the lowest of 5 percent and the highest at 25 percent. Chairman of OJK Board of Commissioners Wimboh Santoso said that OJK also has other objectives through this policy, namely to encourage domestic consumption.

The ease of owning motorized vehicle financing facilities is expected to encourage community productivity and further increase income. But OJK still pays attention to the aspect of prudence even though it frees up the down payment.

Therefore, a zero percent down payment can only be given to a finance company that has a non-performing loan ratio below one percent.

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