OJK Introduces New Regulation on Secondary Housing Financing

The Financial Services Authority (“OJK”) is finalizing a Draft OJK Regulation (“RPOJK”) on the Supervision of Secondary Housing Financing Companies (Pengawasan Perusahaan Pembiayaan Sekunder Perumahan - “PPSP”). This new regulation is being prepared to strengthen governance, implement risk-based supervision, and expand the scope of business activities of secondary housing financing companies amid the continuously increasing financing needs of the national housing sector.

“The strengthening of the housing financing ecosystem must be carried out in an integrated manner, including by strengthening the institutional framework and governance of secondary housing financing institutions so that they become more adaptive to market dynamics and long-term funding needs,” said Dian Ediana Rae, Chief Executive of Banking Supervision at OJK.

RPOJK will, in the future, replace certain provisions under POJK No. 4/POJK.05/2018 on Secondary Housing Financing Companies, as most recently amended by POJK No. 12/POJK.05/2022 (collectively referred to as “POJK 4/2018”).

Furthermore, OJK has expanded the scope of business activities of PPSP beyond securitization to also include the provision of loans and/or financing to support the sustainability of homeownership and housing availability. This includes housing ownership financing, home renovation financing, housing project financing, micro housing finance, reverse mortgages, as well as financing schemes such as rent-to-own arrangements and public–private partnership schemes (Kerja Sama Pemerintah Dengan Badan Usaha/KPBU) in the housing sector.