FX.co ★ Indonesia Loan Growth Eases to Over 2-Year Low

In May 2025, Indonesia experienced a deceleration in annual loan growth, which fell to 8.43% from 8.88% in April. This represents the slowest growth rate since April 2023, largely due to diminished purchasing power and a contracting middle class. There was a slight decline in the expansion of both consumption loans and investment loans, with figures adjusting to 8.82% from 8.97% and 13.74% from 15.86%, respectively. Conversely, working capital loans saw a modest increase to 4.94%, up from 4.62% in the previous month. Sector-wise, the industrial and social services sectors were the primary drivers of credit growth. The central bank anticipates that lending will continue to expand at a rate between 8% and 11% for the year.