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Multifinance firms stuck in slow lane as car sales stall
Multifinance companies have recorded continuing decline in yoy growth over the first three months to 4.6 percent in March, primarily due to sluggish first-quarter car sales of just 256,368 units, down 2.9 percent compared to the same period last year.
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New cars are parked on March 13, 2024, at a factory in Bojomangu, Bekasi regency, West Java. (Antara/Fakhri Hermansyah)
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ocal multifinance companies posted modest growth of 4.6 percent year-on-year (yoy) to Rp 510.97 trillion (US$31 billion) in March, according to new data released on Friday by the Financial Services Authority (OJK).
This marks a decline from recorded growth of 5.92 percent in February and 6.04 percent in January, indicating a continued slowdown in figures that range well below the OJK’s targeted projection of 8 to 10 percent for financing growth this year.
The sluggish growth stems from a downturn in new vehicle sales, one of the firms’ primary financing objects, according to Agusman, supervisor of multifinance, venture capital and other financial services at the OJK.
“The financing growth projection will be periodically reviewed, taking into account both global and domestic economic conditions,” Agusman said on April 17.
The Association of Indonesian Automotive Manufacturers (Gaikindo) reported that new car sales in the first four months of 2025 totaled just 256,368 units, down 2.9 percent from the same period last year.
The downturn makes the industry’s full-year target of 1 million car sales, a milestone that was missed last year, increasingly out of reach.
Multifinance industry expert Jodjana Jody attributed the sluggish financing growth to weakening purchasing power, as evidenced by the decline in new car sales. He noted that even the Idul Fitri holiday season, when consumer spending typically peaked, had failed to drive multifinance growth this year.
