Indonesian Banking Industry Offers Lower Loan Interest Than Fintech

Indonesian Banking Industry Offers Lower Loan Interest Than Fintech

FINTECH –  JAKARTA. Paylater has become a major attraction in the financial industry today as more and more people are interested in using it. Banks are also competing to seize this profitable business potential.

They enter the competition by offering more competitive interest rates compared to the paylater services owned by financial technology (fintech) companies.

Currently, Bank CIMB Niaga and Bank BTN are preparing to participate in this paylater business, competing with major banks such as Bank Mandiri and Bank Central Asia (BCA) who have already entered this market.

According to Nixon Napitupulu, President Director of BTN, banks involved in pay-later services are currently able to offer lower interest rates compared to fintech.

“From my point of view, banks can offer interest rates of around 12% per year,” he told KONTAN.

Nixon explained that BTN’s paylater service is still in the development stage and is expected to obtain launch permission by the end of March 2024. Their main target is customers who are already part of the bank.

The reason BTN introduced pay-later services is to prevent existing customers from getting trapped in bad credit with online loan companies. This is intended to reduce the risk of bad credit that can occur if customers get trapped in online loans.

“They should use BTN’s pay-later which indeed has a lower risk,” said Nixon.

Noviady Wahyudi, Consumer Director of CIMB Niaga, also revealed that the advantage of banking paylater is lower interest rates. Banks view paylater as part of a more comprehensive financial solution.

Although Noviady did not want to mention the paylater interest rate offered by CIMB Niaga, he stated that paylater transactions at the bank grew 1.5 times last year.

“Paylater contributes about 10% of total personal loans, and the target is for paylater transaction growth to double in 2024,” he said.

Paylater products from banks seem to offer lower interest rates compared to some fintech. For example, BCA still offers promotional interest rates until March 31, 2024, starting from 0% per month for one and three-month installments, and 1.25% for 6 and 12-month installments.

Hera F. Haryn, EVP of Corporate Communication & Social Responsibility BCA, stated that customer interest in using BCA’s paylater is very high. She hopes that paylater transactions this year can grow faster, in line with more positive economic growth prospects.

Meanwhile, Bank Mandiri’s paylater offers interest rates starting from 0% for 1 and 3-month tenors and starting from 1.5% flat per month for tenors over 3 months, plus admin fees starting from 0.25% per transaction.

On the other hand, some paylater fintechs set higher loan interest rates. For example, Shopee’s Spaylater offers an interest rate of 2.95%, while Kredivo sets an interest rate of 2.6% for installments with tenors over 3 months.

Editor: Syamsul Azhar


Industri perbankan di Indonesia menawarkan suku bunga pinjaman yang lebih rendah daripada industri financial technology (fintech). Hal ini membuat banyak orang memilih untuk meminjam uang melalui bank daripada melalui platform fintech. Berkat regulasi perbankan yang lebih ketat, suku bunga yang ditawarkan oleh bank cenderung lebih rendah dan stabil dibandingkan dengan fintech. Meskipun teknologi finansial menawarkan kemudahan dan kecepatan dalam proses peminjaman uang, banyak penduduk Indonesia lebih memilih opsi perbankan tradisional karena suku bunga yang lebih kompetitif dan lebih terjamin.

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