Jakarta. Bank Indonesia (BI) has extended its zero-down-payment policy for home and vehicle loans through the end of 2027, seeking to support bank lending and stimulate demand in the property and automotive sectors.

The policy, effective from Jan. 1 to Dec. 31, 2027, allows eligible banks to finance up to 100% of a property's purchase price and offer vehicle loans with no minimum down payment for new vehicles.

BI Governor Destry Damayanti announced the extension at a news conference in Jakarta on Wednesday, saying the property financing provision covers landed houses, apartments, shophouses and office houses.

The 100% loan-to-value (LTV) or financing-to-value (FTV) ratio is available only to banks that meet BI's asset-quality requirements. Banks must have a gross non-performing loan (NPL) or non-performing financing (NPF) ratio below 5% to qualify.

The central bank is also extending the minimum zero-down-payment provision for loans financing all types of new motor vehicles, including cars and motorcycles.

The extension moves the policy's expiration date from Dec. 31, 2026, to Dec. 31, 2027. Banks will continue to assess borrowers' repayment capacity when approving loans.

BI first introduced the zero-down-payment provisions for property and vehicle financing in February 2021, with implementation beginning on March 1 that year. Initially part of a government effort to accelerate the economic recovery from the COVID-19 pandemic, the policy has since been maintained to encourage credit growth and support household spending.

Data from the Association of Indonesian Automotive Industry (Gaikindo) show that domestic car sales fell 6.3% year-on-year to 833,692 units in 2025, down from 889,680 units in 2024, amid weakening consumer purchasing power. Sales nevertheless exceeded the association's revised target of 780,000 units.

The housing market also showed signs of recovery late last year after contracting in the middle quarters. Home sales fell 3.80% year-on-year in the second quarter of 2025 and 1.29% in the third quarter, before rebounding with 7.83% growth in the fourth quarter.

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