BI interest rises to 4.25 percent, how are KPR and credit card payments going?

Jakarta, CNN Indonesia

Bank of Indonesia (BI) relaunch mold interest rate The BI 7-Day Reverse Repo Rate (BI7DRR) was 50 basis points (bps) at 4.25 percent Thursday (9/22).

The central bank also raises interest rates storage area increased by 50 basis points to 3.5 percent and interest rates loan facility increased by 50 bps to 5 percent.

“The Bank Indonesia Board of Governors meeting on September 21-22, 2022 decided to increase the BI 7-Day Reverse Repo Rate (BI7DRR) by 50 basis points,” BI Governor Perry Warjiyo said at a news conference. , Thursday (22/9).


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So what is the effect of rising BI interest rates on home ownership loans (KPR) and credit cards?

Bank Permata economist Josua Pardede said that with the decision, the banking sector will also raise interest rates.

This is because the BI benchmark interest rate is the benchmark for banks in setting interest rates on deposits and credit, including government loans, such as home equity loans (KPR), automotive loans, and so on. Street.

However, Josua said that BI’s interest rate hike won’t suddenly impact credit card interest. The reason is that increasing credit card interest takes time to adjust.

According to him, the increase in credit interest will only be felt next year.

“The transmission or adjustment time is on average about 2-3 quarters. This means that on the side of the overall increase in the interest rate of the loan it also takes time,” Josua told.

He also said that the increase in loan rates will also depend on the policies of each bank. However, he believes that the increase will not be greater than what BI did.

This is because the current bank liquidity situation is still loosened. This is reflected in the ratio of liquidity instruments to TPF (AL / DPK) which is still above 25%.

“Cash is still very free. This means that the adjustment will still not be as high as BI’s benchmark interest rate hike,” Josua said.

He also said that the same thing would happen with the increase in mortgage payments. The increase will not exceed the BI interest rate and will take time.

The impact of the increase in mortgages is felt only by those who started the installments. Because, for those who just want to apply for a mortgage, the bank offers fixed rate at the beginning of the period.

On the other hand, according to Joshua, Increasing BI interest rates has a more significant impact on the floating rate scheme, such as the interest you usually take when mortgage payments begin.

Meanwhile, Center of Economics and Law Studies (CELIOS) director Bhima Yudhistira said that after BI raises the benchmark interest rate to 4.75%, commercial banks will also make loan interest adjustments in a short time. .

“The clear impact on the real sector may reduce the interest of economic operators to borrow from banks. Interest will be more expensive, while consumer demand is weak,” said Bhima.

Meanwhile, for consumer loans such as mortgages in the coming months, it is suspected that there will be less interest due to rising interest rates.

“For consumer loans such as mortgages and auto loans the cloud is pretty dark in the coming months,” Bhima added.

Therefore, banks need to be prepared to find ways in which mortgage customers are still interested in borrowing. For example, floral promotions fixed rate for loans extended up to 5 years.

[Gambas:Video CNN]

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