Ministry of Housing and Settlement: 40-Year Subsidised Mortgage Scheme Aids Citizens

The Ministry of Housing and Settlement (PKP) has revealed that a flexible 40-year subsidized mortgage loan scheme can assist citizens in owning homes.

‘President’s directive for a people-friendly 40-year KPR is clear; this structure lowers monthly repayments. The public is given options—again, options. The choices range from 10, 20, 30, to 40 years,’ said Sri Haryati, Director General of Urban Housing at the Ministry of Housing and Settlement, in Jakarta on Tuesday.

Currently, Sri noted, the 40-year flexible mortgage scheme is under discussion with the People’s Housing Savings Management Agency (BP Tapera) and banks.

‘Minister PKP always instructs us to consult all stakeholders—particularly the public, banks, and developers—when drafting regulations. We’ve done this repeatedly to ensure smooth implementation once the rules are issued,’ she added.

The 40-year scheme is optional and tailored to citizens’ capabilities, meaning individuals will select based on their financial capacity.

‘When I see my salary, there’s the ability to repay. Banks will also assess this. Now, we’ve opened up the option for up to 40 years, potentially reducing repayments to around Rp700,000,’ Sri explained.

She stated the scheme will greatly assist those previously unable to dream of homeownership, as the 40-year subsidized mortgage option now makes it feasible.

Minister of Housing and Settlement Maruarar Sirait (Ara) confirmed the government is preparing regulations for a 40-year subsidized housing mortgage scheme as per President Prabowo Subianto’s directive.

Ara said the government is currently conducting simulations and preparing supporting regulations before officially announcing the long-term tenor policy.

He stressed the 40-year option would be voluntary, allowing citizens to choose shorter terms based on their affordability and needs.

He explained that citizens retain the option to select 10, 20, or 30-year terms, ensuring payment flexibility remains a priority in the policy.