Driving Ahead
    Category: Companies & People By : Ardian Wibisono Read : 1064 Date : Saturday, September 10, 2016 - 07:12:14

    Ahmad Zamroni / Forbes Indonesia

    The recent economic slowdown has caused car and motorbike sales to decline, and this trend has also affected the multi-finance industry. With less new cars and bikes sold, there’s less demand for financing them. Many multi-finance companies also face rising NPLs. However, there is one bright spot: used car sales, which rise in popularity during slowdown.

    That’s good news for PT Batavia Prosperindo Finance, one of the main financing firms for used-car sales. Last year, despite the economic situation, Batavia still managed double digit growth of 11% to Rp 250 billion sales. This year, Batavia President Director Markus Dinarto Pranoto, 65, says Batavia will be able to maintain growth of 10%. “Batavia can maintain its performance because it has the right strategy,” says Markus. For its outstanding long-term performance, Batavia was selected as one of this year’s 50 Best of the Best companies.

    Used-car financing is the company’s biggest cash cow, with consumer financing contributing more than 50% of total revenue in 2015. Its car financing is focused on Japanese brands such as Toyota, Honda and Daihatsu, sold in a price range of Rp 100 to 150 million.

    Batavia has deep roots. It was first established in 1994 as PT Bira Multi Financing before being acquired by the Batavia Prosperindo group in 2004, and the current name adopted in 2007. The firm has focused on used-car financing since 2004, then adding heavy equipment financing in 2012. Most recently it has branched into interesting areas such as financing weddings and home purchases. It is also exploring multi-purpose loans. The company went public in 2009 (the related Batavia Prosperindo International went public in 2014).

    Markus wants to turn challenges into opportunity. Hit by the slowdown in the overall economy and commodities, many multi-finance firms are pulling back, and dealing with rising NPLs. Batavia therefore as a chance to grab market share from its rivals. In the first quarter, Batavia financed about 1,000 car purchases, up 33% from the 750 in the same period last year.

    To retain those customers, Batavia is looking to improve its service quality. One example is speeding up the loan-approval process. Previously, headquarters could only do loan approval, causing a delay, but the company is now authorizing branch heads to handle this, allowing for faster approvals. So far, 26 out of 53 branches can now make approvals in-house.