KONTAN.CO.ID - JAKARTA. The country's multi-finance industry is back with the arrival of new foreign investors from Japan. Following this, Mitsubishi UFJ Financial Group (MUFG) acquired the Home Credit Group B.V. business. in Indonesia and the Philippines.

The purchase of the two business units, valued at €615 million, involved a consortium led by Krungsri Bank. The transaction is expected to be completed in the second half of 2023.

For the Home Credit Indonesia business, purchase transactions were recorded at € 209 million. Kungsri Bank will become the majority shareholder of 75%, then there is I Dewa Made Susila who is currently the Main Director of Adira Finance with 15% and the remaining 10% is owned by Adira Finance.

"This transaction is a form of support and confidence in the quality of our business and team which can further strengthen our position as a leading financial company in Indonesia." said Chief Executive Officer of Home Credit Indonesia Animesh Narang in his official statement, Thursday (24/11).

Meanwhile, Adira Finance Main Director Dewa Made Susila said that this transaction aims to build synergies between the MUFG group, including Bank Danamon within it.

"Hopefully, Adira Finance can continue to increase collaboration with MUFG group entities to serve customers throughout Indonesia," he said.

Previously, many Japanese investors had also tried their luck in the Indonesian multi-finance industry. For example, a company from Japan, JACCS Co., Ltd. (JACCS) which is strengthening its expansion in Indonesia through JACCS MPM Finance Indonesia.

Seeing this phenomenon, Director of the Center for Economic and Law Studies (Celios) Bhima Yudhistira realized that acquisitions by foreign investors, especially East Asian countries including Japan and Korea, have indeed been increasing in recent years.

He saw that these investors saw the demographic potential in Indonesia that could still be developed. Bearing in mind, the space for growth in their country of origin is considered to be increasingly narrow.

"Take a look at for example the credit to GDP in these countries is already above 100% on average, while the credit to GDP ratio in Indonesia is only around 34%," said Bhima.

In addition, Bhima also sees business prospects in Indonesia compared to countries that are actively entering the country's financial industry, which is more dynamic and can develop.

"Both the corporate and SME segments, this is the trigger," he added.

Meanwhile, Economist and Research Director of CORE Indonesia Piter Abdullah added that opportunities in Indonesia's financial sector are still very open with attractive profit levels.

"So it's only natural that foreigners try to get into Indonesia. Foreign ownership provisions are also quite lax," he said.

According to him, the presence of these investors can have a positive impact on the country's financial industry. Among them is the hope that new technology will enter and encourage competition which will ultimately improve service quality.