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Indonesia's pawn financing growth slows to 44.60% but still outpaces other lenders

Published Data as of IndonesiaCreditMFI
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Key points

Implications

ExecutivesCollateral-based small loans are taking household demand that once went to MFIs; consider gold- or asset-backed products alongside unsecured lines.
InvestorsPawn growth is slowing from very high levels; valuations that assume the first-half pace look stretched.
OperatorsTrack collateral values and loan-to-value on pawn books monthly, since balances move with the value of pledged assets.

Facts

Pawn industry: OJK reported at its monthly press conference on 5 October that pawn-industry financing reached IDR 156.61 trn at end-August (down from IDR 160.78 trn at end-July), 1 up 44.60% year on year (down from 50.73% in July). 2 Pawn-loan (gadai) products made up 84.82% of the total. 3 OJK described the industry's credit risk as contained but gave no ratio.

Microfinance institutions: financing by OJK-licensed microfinance institutions (LKM) was IDR 1.05 trn in August, a change of −0.33% year on year. 4

Analysis

Time series: pawn financing growth has decelerated from 60.27% in March 5 to 50.73% in July 6 and 44.60% in August (chart), and the outstanding balance fell month on month in August.

Across lenders, pawn financing is still the fastest-growing household credit channel OJK reports. Online lending (pindar) grew 22.07% 7, bank credit 13.65% 8 and finance-company receivables 1.68%. 9 Bank consumer credit grew 5.0% in Bank Indonesia's data. 10 Collateralised, short-tenor pawn credit is gaining share while unsecured credit growth slows.

Microfinance institutions are moving the other way: their loan books are flat to shrinking, and OJK is preparing write-off rules that require full provisioning of 100% before a loan can be written off. 11

Pawn industry financing, year-on-year growth (%)
02040608060.272026-0356.82026-0457.972026-0554.472026-0650.732026-0744.62026-08
Pawn industry financing, year-on-year growth (%)
2026-0360.27
2026-0456.8
2026-0557.97
2026-0654.47
2026-0750.73
2026-0844.6

Year-on-year growth in financing outstanding of OJK-licensed pawn companies (OJK, as reported by Kontan) · Source: OJK monthly press conference data via Kontan (2026-03, 2026-04, 2026-05, 2026-06, 2026-07, 2026-08)

Counterpoints and uncertainties

Pawn balances depend heavily on the value of pledged collateral, much of it gold, so part of the slowdown may reflect collateral prices rather than demand. OJK did not publish a pawn-industry non-performing ratio, so the credit quality of the expansion cannot be compared with pindar or finance companies. LKMs are a small segment, and their contraction may reflect licensing changes as well as weaker demand.

Key figures

  1. Pawn industry financing outstanding (OJK): IDR 156.61 trn (down from IDR 160.78 trn at end-July). Financing outstanding of licensed pawn companies. Pawn (pergadaian) industry. Basis date: 31 Aug 2026. Source: Kontan: Penyaluran pembiayaan industri pergadaian tumbuh 44,60% per Agustus 2026 (2026-10-05)
  2. Pawn industry financing, year-on-year growth: 44.60% (down from 50.73% in July). Year-on-year growth in financing outstanding of licensed pawn companies. Pawn (pergadaian) industry. Basis date: 31 Aug 2026. Source: OJK: Siaran Pers RDKB September 2026 (SP 185/OJK/DKPU/X/2026, 2026-10-05)
  3. Pawn-loan (gadai) product share of pawn financing: 84.82%. Gadai (pledge) products as a share of total pawn-industry financing. Pawn (pergadaian) industry. Basis date: 31 Aug 2026. Source: Kontan: Penyaluran pembiayaan industri pergadaian tumbuh 44,60% per Agustus 2026 (2026-10-05)
  4. Microfinance institutions (LKM) financing, year-on-year growth: −0.33%. Year-on-year change in financing outstanding of OJK-licensed microfinance institutions. Microfinance institutions (LKM). Basis date: 31 Aug 2026. Source: OJK: Siaran Pers RDKB September 2026 (SP 185/OJK/DKPU/X/2026, 2026-10-05)
  5. Pawn industry financing, year-on-year growth: 60.27%. Year-on-year growth in financing outstanding of licensed pawn companies. Pawn (pergadaian) industry. Basis date: 31 Mar 2026. Source: Kontan: Penyaluran pembiayaan industri pergadaian tumbuh 56,80% per April 2026 (2026-06-05)
  6. Pawn industry financing, year-on-year growth: 50.73%. Year-on-year growth in financing outstanding of licensed pawn companies. Pawn (pergadaian) industry. Basis date: 31 Jul 2026. Source: Kontan: Penyaluran pembiayaan industri pergadaian tumbuh 44,60% per Agustus 2026 (2026-10-05)
  7. Online lending outstanding, year-on-year growth: 22.07% (down from 24.76% in July and 25.88% in June)
    July and June growth rates are from OJK's September 2026 board press release (RDKB August 2026).
    . Year-on-year growth in outstanding loans of licensed P2P lending platforms. Licensed online lending (pindar / P2P) platforms. Basis date: 31 Aug 2026. Source: OJK: Siaran Pers RDKB September 2026 (SP 185/OJK/DKPU/X/2026, 2026-10-05)
  8. Bank credit growth (OJK): 13.65% (up from 13.58% in July). Year-on-year growth of bank credit outstanding, as announced by OJK. Indonesian banking industry. Basis date: 31 Aug 2026. Source: Asbisindo (republishing OJK press release): OJK luncurkan RP3I 2026-2030 (2026-10-02)
  9. Finance companies' receivables, year-on-year growth: 1.68% (down from 2.01% in July). Year-on-year growth in finance companies' financing receivables. Finance companies (multifinance) supervised by OJK. Basis date: 31 Aug 2026. Source: OJK: Siaran Pers RDKB September 2026 (SP 185/OJK/DKPU/X/2026, 2026-10-05)
  10. Consumer credit growth (BI, YoY): 5.0% (down from 5.3% in July 2026)
    Bank Indonesia's money-survey credit series (loans only; excludes debt securities and bankers' acceptances). Differs from OJK's commercial-bank series. Headline total growth confirmed in BI's release (bi.go.id, checked 2026-09-29); segment breakdowns from media reports citing BI (Kontan, Industry.co.id), which agree.
    . Year-on-year growth of bank consumption loans (kredit konsumsi), BI money survey. Indonesia, banking system (BI money-survey basis). Basis date: 31 Aug 2026. Source: Industry.co.id: Uang Beredar Agustus 2026 Tumbuh 8,2%, Kredit Perbankan Makin Terakselerasi (2026-09-24), citing Bank Indonesia
  11. Provisioning required before LKM write-off: 100%. Provisioning coverage a non-performing loan must carry before write-off under the planned amendment to POJK 41/2024. Microfinance institutions (LKM). Basis date: 25 Sep 2026. Source: Indikator Bisnis: OJK Siapkan Aturan Hapus Buku Kredit LKM Terbit Kuartal IV 2026 (2026-09-25)

Sources

  1. Kontan: Penyaluran pembiayaan industri pergadaian tumbuh 44,60% per Agustus 2026 (2026-10-05)
  2. Warta Ekonomi: OJK catat pembiayaan LKM kontraksi, pergadaian malah tumbuh 44,60% (2026-10-05)
  3. Kontan: Penyaluran pembiayaan industri pergadaian tumbuh 54,47% per Juni 2026
  4. Kontan: Penyaluran pembiayaan industri pergadaian tumbuh 56,80% per April 2026 (2026-06-05)
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A Japanese version of this article is available: 日本語版

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