32.9% Increase in Household Financing from Commercial Banks

Bank Indonesia (BI) reported that in August 2021, the majority, or 32.9%, of Indonesian households still used commercial banks as their primary source of financing. However, this figure decreased from 37.6% the previous month.

Next, 17.3% of households used cooperatives as a source of financing to meet their needs. This figure also decreased from 19.9% the previous month. Furthermore, 17.3% of households used leasing as supplementary financing. The previous month, the use of leasing to meet household needs was higher, reaching 19.9%. Another 12.2% of households used friends as a source of financing, down from 16.3% the previous month.

Other sources of financing for household needs included Fintech (Financial Technology) and Rural Banks (BPR), at 6.5% and 6.1% respectively. These figures increased from 4.4% for Fintech and 1.6% for BPR the previous month.

BI also noted that based on the type of financing applied for, Multi-Purpose Loans (KMG) were the most frequently applied-for product by households in August 2021, with a share of 35.5% of total new financing applications. This figure decreased compared to the previous month's 45.7%.

This was followed by Motor Vehicle Loans (KKB) at 21.4%, an increase from 19.7% the previous month. Home Ownership Loans (KPR) accounted for 14% of households applying for such loans, an increase from 8.3% the previous month.

Meanwhile, household appliance loans and credit card applications amounted to 12.1% and 5.7% respectively in August 2021. Household appliance loans increased from 6.1% the previous month, while credit card applications decreased from 11.6% the previous month.