Indonesia Auto Finance Market is expected to generate USD ~53 Bn by 2026 owning to increasing Digitisation, Positive Outlook for E-Vehicles and Increasing Urbanization: Ken Research

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Feb 07, 2023, 04:47 ET

GURUGRAM, India, Feb. 7, 2023 /PRNewswire/ -- Indonesia Auto Finance Market is in the growing stage, being driven by rising demand of automotives, positive outlook for e-vehicles, and increasing urbanization. There are several players in the Indonesia Auto Finance market some of which are Toyota astra finance, Daihatsu, Mitsubishi lease and finance, Suzuki Finance Indonesia, and Honda etc.

Increasing Digitization: multi-finance companies today offer convenient facilities in terms of online presence. Automotive Financing Companies are increasingly moving towards higher technological advancements to improve operational profits as well as customer experience, which includes digital installment payment system, zero or very less face-to-face dealing, and simpler procedure, e.g. - Kredit Pintar. Car dealerships are expected to increasingly bring the experience of car shopping online by range of ways such as providing digital showrooms as well as e-finance. In the past, 5 – 10 years, Indonesia is witnessing a new wave of digital enhancements with several new fin-tech platforms for aggregation, peer – to – peer lending and more coming in the market. Some of the most well-known of these start- ups are- broom, cermati etc.

Revision of down payment rates: Financial authority of Indonesia (OJK) has allowed lower down payment rates for multi finance companies and banks whose NPF is less than 1%.

Low Interest Rates: Credit lending companies have lowered the interest rates to increase the loan taking capacity of customers; further supported by the Government's efforts to increase financial support SMEs as SMEs contribute to major share of the total GDP of Indonesia. And also, the policies to take credit have been relaxed significantly to ease the process; strict regulations and verification of long-list of documents have been reduced.

Expanding urban population: Growing urban population and the increasing buying capacity as well as the awareness of the consumers has made automobile as well as auto finance industry to grow hand-in-hand.

Growth of E-vehicles: that Indonesian EV sector is still in its infancy but these also show that market interest has grown significantly. Electrum, a joint venture company between Indonesia decacorn Gojek and energy firm TBS Energi Utama (TBS), synergize to accelerate the development of the most complete and integrated electric vehicle ecosystem in Indonesia. Numerous policies have been issued by the government, to further boost the EV sector, such as Positive Investment List (PIL) as per which the companies that participate in development of EV sector are eligible to benefits like ease of attaining business licenses and leveraging various tax incentives.

Analysts at Ken Research in their latest publication "Indonesia Auto Finance Industry Outlook to 2026 - Driven by growing digital penetration, evolving vehicle ownership characteristics and rebates by the Government amidst systematically regulated vehicle ownership and financing policies by the regulatory authorities" by Ken Research observed that Indonesia Auto Finance Market is in the Growing Phase with Banking Institutions and NBFCs leading the Market and Online Aggregators Platforms entering the Market. Increasing Digitisation, Positive Outlook for E-Vehicles, Revision of Down payments, Expanding Population and Lower Interest Rates, are expected to contribute to the market growth over the forecast period. The Indonesia Auto Finance Market is expected to see high growth rate over the forecasted period 2021-2026F.

Key Segments Covered

Indonesia Auto Finance Market

By Category of Lenders (by Revenue), 2021 & 2026F

Captive Financing Companies
Banks
NBFCs

By Type Of Vehicles (by Revenue), 2021 & 2026F

Two Wheelers
Three Wheelers
Four Wheelers

By Type of Ownership (by Revenue), 2021 & 2026F

Used Cars
New Cars

By Category of Vehicles (by Revenue), 2021 & 2026F

Passenger Vehicles
Commercial Vehicles

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By Duration of Loan (by Revenue), 2021 & 2026F

1 Year
2 Year
3 Year
3+ Years

By Geographical Location (by Revenue), 2021 & 2026F

Rural & Semi Urban
Urban
Metropolitan

Key Target Audience

Banks and its Subsidiaries
NBFCs
Captive Finance Companies
Government and Institutions
Automobile Companies
Car Dealers
Government and Institutions
Existing Auto Finance Companies
OEM Dealerships
New Market Entrants
Investors
Auto mobile Associations

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Time Period Captured in the Report:-

Historical Period: 2016-2020
Base Year: 2021
Forecast Period: 2022– 2026F

Companies Covered:-

Bank CIMB Niaga
Bank Rakyat Indonesia
Danamon Bank (Adira Dinamika Finance)
Mandiri Bank (Mandiri Tunas Finance)
Megabank (WOM)
Bank Negara Indonesia
BCA Bank
Bank Jasa Jakarta
Cekaja
ACC Finance
Oto Multiartha
Radana Bhaskara
Adira Finance
Indomobil Multi Jasa
Mitsui Auto Finance
Mandiri Tunas Finance
Rabana Investindo
Maybank Finance
Mobil88
OLX Indonesia
Mobil123
Carmudi
Oto.com
Diamond Smart Auto
Carro

Key Topics Covered in the Report:-

Demographic overview and major industries of Indonesia
Economic Overview of Indonesia
Trade Scenario of Indonesia
Indonesia Automotive Market – Vehicle sales
Indonesia Automotive Market - Major OEM brands basis passenger cars sales
Indonesia Auto Finance Ecosystem
Indonesia Auto Finance Market Value Chain Analysis
Major Types of auto loans available in the Indonesia Auto Finance Market
Growth Drivers of Indonesia Auto Finance Industry
Decision making Parameters for selecting Auto loan Vendor
SWOT Analysis of the industry
Trends and Developments in the Industry
Issues and challenges in the industry
Government initiatives in the industry
COVID-19 Impact on the Indonesia Auto Finance Industry
Customer Journey
Indonesia Auto Finance Market Sizing
Indonesia Auto Finance Market Segmentation
Indonesia Automotive Finance Aggregator
Indonesia Auto Finance Market - Future Sizing
Indonesia Auto Finance Market - Future Segmentation
Digital Disruptions in the Indonesia Auto Finance Industry
Analyst Recommendations

For more insights on the market intelligence, refer to below link:-

Indonesia Auto Finance Industry

Related Reports By Ken Research:-

Thailand Auto Finance Market Outlook to 2026F- Driven by Road Infrastructure Development and Economic Growth in the Country

According to Ken Research estimates, the Thailand Auto Finance Market grew from approximately THB 900 Bn in 2016 to approximately THB 1200 Bn in 2021, and is forecasted to grow further to ~ THB 1800 Bn by 2026F owing to the increasing purchasing power of the consumers and adoption of EVs. The automotive industry in Thailand is the largest in Southeast Asia and the 10th largest in the world. Banks have been the dominant players as they have huge pre-built database that they leverage for their own advantage. Many Western brands are present in the country but Japanese brands have long had a dominant position in Thailand due to affordable prices.

UAE Auto Finance Market Outlook to 2026F- Driven by growing digital penetration, evolving vehicle ownership characteristics and rebates by the Government amidst systematically regulated vehicle ownership and financing policies by the regulatory authorities

According to Ken Research estimates, that UAE Auto Finance Market has decreased from 2016 to 2021 at a CAGR of -6.3% owing to government regulations, lifestyle changes and the COVID-19 lockdown but in the upcoming period, the growth is expected to normalize owing to the emergence of new and improved technologies. UAE Auto Finance Market is estimated to grow at a positive CAGR of ~17% in between 2022E and 2026F. UAE Auto Finance Industry is expected to witness good growth in future owing to reasons such as Increasing Population, growing income levels, new and innovative business models and more.

Egypt Auto Finance Market Outlook to 2027– Driven by women drivers entering the market, digital advancements and initiatives by the Government

Urbanization is expected to rise to more than 60% by 2030, which means increased demand for jobs, housing, infrastructure, and social services such as public transportation. Moreover, the recent increase in the cost of public transportation has led to increase in demand for personal vehicles. Egypt Auto Finance Market is currently at the growth stage and the market is currently increasing at a double digit CAGR owing because of lower interest rate, growing disposable income and easy financing options.

Malaysia Automotive Finance Market Outlook to 2026-Driven by exorbitant car prices, growing digital penetration, preference for owning passenger cars amidst systematically regulated car ownership policies by the Government

Number of passenger car ownership in Malaysia exceeded the population in Malaysia. Poor public transport infrastructure is one of the reasons. The used car industry is also enjoying a boom in business, and is reportedly on-track to register double-digit growth in sales. Import of vehicles still exceeds the exports resulting huge trade deficit. Government has taken various initiatives to support domestic manufacturing of vehicles by setting up companies like Proton and Perodua. Government also gives various incentives on purchasing of National Car. The market is at maturity stage with stable population, high ownership of car and small domestic commercial vehicle market, the opportunity of growth in Malaysia is quite limited.

Philippines Auto Finance Market Outlook to 2026- Driven by change in consumer spending, ease in provision of loans, improving technology and government support

Philippines Auto Finance Market is Expected to grow at a good CAGR in between 2021 and 2026F, one of the major determinants for the surging growth in coming years is the Increasing Population and growing income levels leading to rise in sales of cars , the rise in Auto Outstanding Loans in Philippines, the increase in Auto Loan Outstanding is expected a high growth rate between 2021F-2026F, High-Mid range car models are expected to witness strong success as the majority of car buyers segment includes the High Income people leading to larger Loan amount per customer, Expectation of high growth in car sales especially in Green cars as the government is building the infrastructure like the charging point at public parks . Higher digitization and usage of Artificial Intelligence and Machine Learning to improve customer convenience. New Business Models such as Subscription Lending, Shared ownership financing are coming into play which will lead the way for high growth rate in the Philippines Auto Finance Market.

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SOURCE Ken Research