Interest Rate Hikes Become a 'Spectre' for Multifinance Industry

Deputy Commissioner for Supervision of Financing Institutions, Venture Capital, Microfinance Institutions and Other Financial Services Institutions at the OJK, Jasmi, has spoken candidly about the challenges facing the multifinance industry this year. One of the major concerns is related to interest rates. As is known, the capital or equity of multifinance companies is largely sourced from banks. Therefore, if bank interest rates rise, the costs for multifinance companies will also swell. For context, Bank Indonesia has raised its benchmark interest rate three times this year, with a total increase of 100 basis points. The most recent Board of Governors’ Meeting on 21-22 July 2026 decided to hold the BI-Rate at 5.75%. “One of the challenges we face together at the moment is certainly how to deal with changes in interest rates, because we know that from the business side of multifinance, apart from equity, support comes from other financial services institutions,” Jasmi stated at the Multifinance CEO Gathering on Tuesday. He noted that interest rate hikes are unavoidable amid global economic uncertainty. Jasmi expressed hope that this condition would not last long, so that the public’s purchasing power could be maintained in the future. “Hopefully it won’t be too high and won’t last too long, so that the impact can be measured properly,” he concluded.