This is How Much Indonesian Debt Collectors Earn for Each Repossessed Overdue Credit Vehicle

Borrowers who fail to repay loans after the stipulated deadline will face debt collectors. The debt collector profession is often negatively connoted, especially if debt collection methods do not comply with applicable regulations. Nevertheless, debt collectors can apparently earn substantial income. A practitioner in Asset Recovery Management at one of Indonesia’s vehicle leasing companies, Budi Baonk, revealed that payments for debt collectors in vehicle credit delinquency cases are determined based on agreements with the leasing company. The commission or fee for repossessing leasing assets is agreed upon when the power of attorney is issued from the Leasing Company to the External Debt Collection Service Company. The payment range, according to Budi Baonk, is usually around Rp5 million to Rp20 million. “The price range (debt collector fee) is at least Rp5 million to Rp20 million,” Budi told CNBC Indonesia in 2023. According to Budi, the amount of the debt collector’s fee depends on the type of vehicle secured. For example, if the car is a new model, it will be more expensive than an old production car. Prices can also vary depending on the debt collector’s business entity itself. Usually, the determination is based on the company’s track record variables. For information, the debt collector profession is permitted under POJK 22 of 2023 on financial services institutions. However, Article 62 of the regulation stipulates that financial services institutions must ensure that collections from consumers are carried out in accordance with prevailing societal norms and legal provisions. Thus, financial services institutions must ensure that collections are conducted without threats or actions that humiliate consumers. Collections must not intimidate and must not be carried out continuously. The regulation also states that collections are to be conducted at the collection address or consumer’s domicile on Mondays to Saturdays, excluding national holidays, from 08:00 to 20:00 local time. Debt collectors are permitted to conduct collections outside the specified place and time, but only with prior consumer consent. The Executive Head of the Financial Services Business Actors’ Behaviour Supervision, Education, and Consumer Protection, Friderica Widyasari Dewi, also reminded that consumers should not only demand consumer protection rights but also be responsible for making payments. “We continue to educate that if you don’t want to meet debt collectors, then pay; what are the obligations like,” said Kiki. If consumers cannot pay, Kiki suggested that consumers proactively request restructuring from financial institutions. However, she said that the final decision on restructuring is the right of the financial company. “But rather than being searched for, it’s better to be proactive yourself if there are obligations that cannot yet be fulfilled,” she said. OJK also emphasised that it will not protect naughty consumers who act in bad faith regarding credit payments. “OJK will not protect naughty consumers,” stressed Deputy Commissioner for the Supervision of Financial Services Business Actors’ Behaviour and Consumer Protection, Sarjito.