What is the Minimum Investment and Capital for a PT PMA in Indonesia?

When planning to establish a foreign-owned company (PT PMA) in Indonesia, one of the first and most critical questions investors ask relates to the financial requirements. You will often hear terms like “investment value” and “paid-up capital,” and understanding the difference is key to planning your venture correctly.

This guide will explain these core financial requirements in simple, plain-English terms to provide the clarity you need.

The “Total Investment Value” – Your Business Plan’s Big Picture

First, it’s important to understand the concept of “Total Investment Value.” Under the current regulations, a PT PMA is generally required to have a total investment plan valued at more than IDR 10 billion (approximately USD 650,000).

What does this mean? This does not mean you need IDR 10 billion in cash in a bank account on day one. Instead, this figure represents the total projected value of your business operations.

The Total Investment Value typically includes:

Fixed Capital: The value of long-term assets like machinery, equipment, and office inventory.
Working Capital: Funds used for one production cycle, covering operational costs like raw materials, employee salaries, and office utilities.

Crucially, the regulation states that this minimum investment value of IDR 10 billion is calculated excluding the value of any land and buildings the company may acquire. This means the investment in core business operations itself must meet this threshold.

The purpose of this requirement is to ensure that foreign investments are substantial, serious, and contribute meaningfully to the economy.

“Paid-Up Capital” – Your Initial Financial Commitment

Within the “Total Investment Value,” there is a more specific requirement known as “Paid-Up Capital” (Modal Disetor).

What does this mean? Paid-Up Capital is the actual amount of funds that the shareholders formally commit to injecting into the company’s bank account to fund its initial operations. The current regulation requires a minimum paid-up capital of at least IDR 10 billion.

It is crucial to understand that the paid-up capital is a part of the total investment value, not in addition to it.

Simple Example: If your company’s investment plan for machinery and working capital is valued at IDR 12 billion, at least IDR 10 billion of that must be fulfilled as paid-up capital from the shareholders. The cost of any land or buildings would be a separate, additional value.

How Do You Fulfill This Requirement During Registration?

A common question is whether you need to transfer this capital before the company is even formed. For the initial registration process, the answer is typically no.

Instead, you will be required to produce a Capital Statement Letter (Surat Pernyataan Kesanggupan Pemegang Saham). This is a formal, signed letter where all shareholders collectively declare that they are capable of and will provide the committed paid-up capital after the company is legally established and has its own corporate bank account.

This signed statement is a key document that is submitted to the government during the company registration process.

In summary, setting up a PT PMA in Indonesia requires a significant business plan (a total investment value of over IDR 10 billion, excluding land and buildings), with a substantial portion of that being formally committed as paid-up capital (at least IDR 10 billion).

Understanding and structuring your capital plan correctly is a critical first step in your investment journey. Misinterpreting these requirements can lead to delays or the rejection of your company’s application.

Accura Indonesia provides expert advisory services to guide you through the financial and legal requirements of setting up your PT PMA. We help you structure your investment plan correctly and prepare all necessary documentation, including the Capital Statement Letter, to ensure a smooth and compliant registration process.