In a significant move to attract foreign investment, the Indonesian government has significantly reduced the minimum paid-up capital for foreign-owned companies (PT PMA), setting the new requirement at IDR 2.5 billion. 

This supersedes the 2021 regulations, which had effectively required investors to pay IDR 10 billion as paid-up capital. 

This change is part of the new Regulation Number 5 of 2025, implemented on October 2, 2025.

According to Article 26, paragraph (10) of the regulation, the minimum paid-up capital is now at least IDR 2.5 billion.

In addition to this key change, the regulation introduces two other critical updates for investors:

1. Capital Must Be Retained for 12 Months with Exceptions

To ensure the capital is used for business development, Article 27, paragraph (1) stipulates that the paid-up capital cannot be transferred out of the company’s bank account for a minimum of 12 months after being deposited.

However, the regulation clarifies that these funds are not frozen and can be used during this period for essential business activities, including:

• Covering the company’s operational expenses.
• Purchasing assets.
• Funding building construction.

2. Land and Building Costs Now Count Towards Investment in Key Sectors

For investors in the property and accommodation sectors, the regulation provides a significant new advantage. 

Article 26, paragraph (5) states that for business activities such as property development, sales, rentals, and short-term or long-term accommodation, the value of land and buildings can now be included as part of the realization of the >IDR 10 billion minimum total investment.

What This Means for Foreign Investors

These changes make Indonesia more accessible for foreign companies by reducing the initial capital barrier while maintaining clarity around investment requirements. The regulatory environment is becoming more flexible and predictable.