Indonesia’s consumer loan companies are in a bit of a soup. After the onset of Covid-19, they’re facing a higher-than-usual amount of payment delays and defaults. Up to 9 million people are expected expected The Jakarta Post Up to 9 million people to fall into poverty, unemployment as COVID-19 hits Read more to lose their jobs and potentially fall into poverty in Indonesia as a result of the pandemic. Understandably, repaying debt is no one’s top priority right now.
Akulaku in limbo, Indonesian consumer loan players need a system reboot
Indonesian soonicorn Akulaku is struggling to repay even the US$5.9 million it owes to European lending partner Mintos. The economic downturn is now exposing its weak internal governance and a reckless growth-by-all-means strategy
Nine million Indonesians are expected to lose jobs and fall into poverty in the coming months. Debt repayments won’t be top priority
That’s a worry for consumer loan companies like Ant Financial-backed Akulaku. It’s already falling behind on paying back its investors
Whether it slides down a spiral of defaults or manages to stop the bleeding isn’t the main issue
What’s important is how Akulaku got into this situation and what type reforms the consumer loan sector needs in a post-Covid world