Developers fear credit histories could slow mortgage applications – Markets
roperty developer association Real Estate Indonesia (REI) has voiced concern that default fintech peer-to-peer (P2P) loans have led many Indonesians to fail to access mortgages, which in turn could bar them from homeownership.
The association has blamed P2P loans as one of the prominent causes behind the bad credit history of potential homeowners, citing that 40 percent of mortgage applications were turned down by banks because of this reason.
This has prompted developers to call on the Financial Services Authority (OJK) to tighten controls on fintech lenders, whom they partly blame for keeping them away from homeownership.
“This situation hinders people from obtaining mortgages and denies them the opportunity to own a home,” said REI chairman Joko Suranto on Saturday, as quoted from Bisnis.
Read also: Jakarta home rentals surge, buying falls in Q1 2024
Failing to make payments on loans leads to a deteriorating credit history, which is recorded in a centralized system operated by the OJK named the Financial Information Service System (SLIK).
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The data, shared between financial institutions in the country, has now incorporated records from online lending and buy now, pay later (BNPL) services on top of existing conventional loans from banks and multi-finance companies.
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