Jakarta. The Financial Services Authority (OJK) announced that six multifinance companies in Indonesia are either in the process of being acquired or have completed acquisitions by foreign investors from South Korea, Hong Kong, and Japan

Agusman, the Chief Executive of the Supervision of Financing and Venture Capital Institutions at OJK, explained that out of the six multifinance companies, four have reported the realization of foreign acquisition, one is in the process of foreign acquisition, and one is awaiting approval for foreign acquisition.

“Foreign investors come from South Korea, Hong Kong, and Japan. The acquisitions are aimed at strengthening capital and expanding business operations,” Agusman said in a statement on Wednesday.

However, Agusman did not disclose the names of the multifinance entities involved. He mentioned that the domestic multifinance industry has a promising performance outlook.

Despite a downturn in the automotive industry, motor vehicle financing disbursement as of June 2024 increased by 11.91% year-on-year (YoY) to Rp 402.43 trillion. “This indicates that financing disbursement continues to grow positively amidst declining motor vehicle sales,” he added.

As for motor vehicle financing performance, multifinance receivables also saw a significant increase of 10.72 percent YoY, reaching Rp 492.17 trillion in June 2024. With this trend, OJK is targeting financing receivables to grow by 10-12 percent by the end of 2024.

However, OJK has also detected a decline in profitability indicators for some multifinance companies. The 10 percent growth in financing receivables has also slowed compared to previous months.

In response, OJK is encouraging multifinance companies to consider diversifying their financing objects. This could include targeting productive financing types, such as investment financing and working capital financing for SMEs, as a response and anticipation of declining motor vehicle sales domestically.

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