Navigating Indonesia’s Housing Savings Program: What You Need to Know

Posted by Written by Ayman Falak Medina Reading Time: 2 minutes

Indonesia’s government plans to introduce a mandatory public housing savings program (Tapera) for employees in the private sector and those who are self-employed.

Employees must contribute three percent of their salaries towards the program. They join civil servants who have been contributing to the fund since 2016. Foreign workers in Indonesia will also be obligated to join the program. Contributions made by foreign workers will be refunded when they complete their employment and depart from Indonesia.

Employers must register their workers in the Tapera scheme by 2027. Penalties for not joining the program include fines, public disclosure of non-compliance, and revocation of business licenses.

Indonesia faces a housing crisis, with millions of citizens lacking adequate housing. The Indonesian government hopes to tackle the backlog of some 37 million houses by expanding the Tapera program.

What is the mechanism of the program?

The Tapera program provides financing assistance for three types of activities:

  1. Mortgages for house purchases;
  2. Financing for house construction; and
  3. Financing for house renovations.

Employees are deducted three percent of their salaries of which 2.5 percent are directly deducted while their employer contributes the remaining 0.5 percent. Independent workers directly bear the three percent.

Program participants can submit their finance applications to a participating Tapera bank which will approve the loan.

To qualify for the program, workers have to fulfill the following criteria:

  • Been a member of the Tapera program for at least 12 months;
  • Has owned a home before; and/or
  • Must utilize the Tapera funds for the three types of activities mentioned.

Termination of the Tapera program

Membership of the Tapera program ceases once the participant:

  • Retires from their employment;
  • Reached the age of 58;
  • Has passed away; or
  • Does not meet the criteria for the program for five consecutive years.

This approach aims to make home ownership and quality housing more accessible to millions of Indonesians, while also providing a structured pathway for foreign workers to contribute to and benefit from the housing market during their stay.

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