Transportation Minister Reveals Banks Hesitant to Finance Ship Purchases, Operators Opt for Used Japanese Ships

JAKARTA, KOMPAS.com - Shipping operators are still struggling to secure ship financing from banks. This situation is pushing operators to use their own funds to purchase and renew their fleets.

Transportation Minister (Menhub) Dudy Purwagandhi explained that banks are more selective when financing ships due to the large investment value and the need for long-term loan tenors.

“Banks only want to finance vessels like barges, for example—those with high economic value,” the Minister said in Jakarta on Wednesday (9/23/2026).

“Indeed, ship financing is not easy. Banks have their own considerations because ships have high values and risks that must be calculated,” he added.

According to Dudy, shipping operators ultimately use their own capital to acquire ships. They also seek more affordable vessels to reduce investment needs.

One approach is buying used ships from Japan. Japanese vessels are considered to have relatively better quality compared to vessels from other countries of the same age.

“From a banking perspective, it is indeed difficult to provide loans for ship purchases. So, operators usually use their own funds,” he said.

“Then, they look for ships that aren’t too expensive, such as buying used vessels from Japan, hoping to get somewhat better quality than ships from other countries with the same age,” he explained.

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Dudy noted that operators have limited options when ship purchases don’t get bank financing.

“If banks don’t finance them, then they have to use their own money. Because banks don’t easily provide long-term financing for ship purchases,” he stated.

He also highlighted that acquiring ships requires significant investment. Shipping companies also need financing for fleet renewal and ship maintenance.

On the other hand, banks have risk assessment mechanisms before extending credit. The large investment requirements and long tenors make ship financing a major challenge for the shipping industry.

Dudy emphasized that solutions need to be found collaboratively, especially for companies seeking new ships or fleet renewal.

Proposal for a dedicated financing institution

Dudy also responded to proposals to establish a specialized financing institution for transportation equipment procurement.

He said the issue with ship financing is not the number of banks available but the ability to provide financing with long tenors.

“There are many banks, but who is willing to finance for a long period?” the Minister remarked.

Dudy added that special financing schemes for the transportation sector have been extensively studied. However, the large capital requirements and lengthy financing tenors make the sector difficult for banks to finance.

“I’m sure many studies have been conducted, but they are not bankable for them because the capital needed is very large,” he said.

According to Dudy, Indonesia’s banking conditions differ from other countries. The domestic banking funding structure limits the ability to provide long-term financing.

“Our banking system still depends on funding sources, including foreign loans, which generally have short tenors,” Dudy emphasized.