Land Law
Mortgage Transitions towards the Electronical Era
25 August 2020



The Minister of Agrarian Affairs and Spatial Planning/Head of the National Land Agency (“Ministry”) has issued Regulation No. 5 of 2020 on Electronically Integrated Mortgage Services (“Regulation No. 5/2020”). The Regulation 5/2020 came into force on 8 July 2020, wherein all Land Offices within the territory of the Republic of Indonesia must have implement all new amendments as stipulated respectively in this new law.


Electronic mortgage services, as per Regulation No. 5/2020, is defined as a series of mortgage service processes in the context of maintaining land registration data which are carried out through an integrated electronic system[1]. The purpose of creating, what used to be paper-based mortgages, into a now electronically data-based collection of all mortgages, enables the fulfillment of principles such as the openness, timeliness, speed, accountable and affordability of the public services framework.


However, factors that still requires addressment includes the implementation of the electronic mortgage services in whether the navigation will be user friendly and whether there still exists any potential obstacles that may have emerged subsequent to this new transition. Are there still any obstacles in the electronic mortgage service that have completely replaced manual mortgage services? Within this article, we simplify important aspects and clarify some prohibitions that were not previously dictated by previous regulations.


Subject of Electronic Mortgage


Regulation No. 5/2020 divides users of the mortgage system into several parties who will be given an account, where submission of applications requires the completed application documentation, as below:



Object of the Electronic Mortgage


Agrarian Law No. 5 of 1960 states that mortgage rights are collateral rights imposed on land rights and objects related to land. Further so, objects that are regulated as mortgage rights in the electronic mortgage rights as per Technical Guidelines No. 2/Juknis-400.HR.02/IV/2020 of 2020 Concerning Technical Guidelines for Electronically Integrated Mortgage Rights Services (“Technical Guidelines No. 2/2020”) states as follows:


  1. Land Rights/Ownership Rights to Apartment Units which according to their nature can be encumbered with Mortgage Rights in accordance with the provisions of applicable laws and regulations;


  1. The imposition stated in point 1 (one) includes buildings, plants, and existing or future works that are an integral part of the land, and which are the property of the land rights holder whose imposition is expressly stated in the Deed of Granting Mortgage Rights (Akta Pemberian Hak Tanggungan or “APHT”); and


  1. If the buildings, plants, and works of work as referred to in point 2 above are not owned by the holder of land rights, the imposition of Mortgage Rights on these objects can only be done by signing on the concerned APHT by the owner or individual given power to do so by him with an authentic deed.


Electronic Mortgage Service System Flow


The government's objective as discussed in the introductory paragraph is to process mortgage services in the context of maintaining land registration data through an electronic system that can be easily accessed by the public. This newly introduced system is expected to help improve the performance and quality of land services, especially in mortgage services[3].


We have created a flow chart of the mortgage service system itself as demonstrated below:



After each process and requirement is completed and approved by the Head of the National Land Office (locally knows as Badan Pertanahan Nasional or “BPN”) the duly approved documentation by the Head of the BPN will then enable the electronic mortgage certificate to be issued within 7 (seven) days subsequent to the electronic mortgage confirming through the system. The electronic mortgage certificate will then be delivered to the creditor via the electronic mortgage system and/or electronic domicile.


New electronic mortgage certificates with new numbers will be issued in relation to all registrations of second-rank mortgages and all subsequent mortgages.


The owner of the electronic mortgage certificate is prohibited to:


  1. Alterations of content, manipulations, fabrications, changes, omissions, destruction of any electronic information and/or documents with the aim of authenticating said electronic information and/or documents; and


  1. Duplication, distribution and/or transmission, replacement or transfer which results in the disclosure of electronic information and/or documents or their copies to other parties who are not involved in the relevant legal activity involving mortgage rights[4].


Electronic Signature


Electronic Signature issued by the Head of BPN or an authorized official must maintain the integrity and authenticity of Electronic Documents. The Head of BPN in providing an electronic signature must first have an electronic certificate containing an Electronic Signature and an identity that shows the legal subject status of the parties in Electronic Transactions issued by the Electronic Certification Operator. Regarding the procedure for obtaining an electronic signature and the parties entitled to issue an electronic certificate can be read in our previous article regarding Electronic Signatures Practices[5].


Obstacles in the Application of Electronic Mortgage Services


Concerning obstacles, the electronic mortgage services do not regulate the role of a notary public and the Power of Attorney to Impose Mortgage Rights (Surat Kuasa Membebankan Hak Tanggungan or “SKMHT”). In the manual mortgage service, SKMHT can also be made by a notary and the notary can check the object of the mortgage that is imposed with SKMHT. However, the electronic mortgage service does not recognize notaries, due to such, there is the prohibition that regulates access for notaries to check on the SMKHT[6].


Additionally, technical constraints such as the problem of delays in validity checking as well as server disruptions in uploading documents have thus caused electronic security services inable to optimally run[7].




The transition of the manual mortgage service system into a now entirely electronically data-based usage of all mortgages has arisen in order to increase the ease of doing business for the public, allowing for their investment needs to be met with ease by applying for loans to financial institutions, particularly banks.


Notwithstanding the above, mortgage rights that have been issued manually prior to the enactment of Regulation No. 5/2020 will then see the registration of the next rank Mortgage Rights to be carried out electronically in accordance with the provisions of laws and regulations. As for the transferring of mortgage rights (cessie, subrogation, etc.), removal of mortgage rights, name change, and data correction(s) will still be carried out through manual services[8].


If there are any queries with regards to how this may affect your business, please contact us for further legal consultation.


This information does not, and is not intended to, constitute as legal advice; instead, all information, content, and materials are for general information only.



©2024. BE Partners. All Rights Reserved

[1] Ministry of Agrarian Affairs and Spatial Planning/Head of National Land Office, Regulation No. 5 of 2020 on Electronically Integrated Mortgage Services, Art.1

[2] Ibid. Art. 22

[3] Technical Guidelines No. 2/Juknis-400.HR.02/IV/2020 of 2020 Concerning Technical Guidelines for Electronically Integrated Mortgage Rights Services, pg. 6 

[4] Ministry of Agrarian Affairs and Spatial Planning/Head of National Land Office, Regulation No. 5 of 2020 on Electronically Integrated Mortgage Services, Art.21 Para 1.

[5] Please refer to our article titled “Electronic Signatures Practices in Indonesia”. 

[6] Kompasiana, " SKMHT "Surat Kuasa Membebankan Hak Tanggungan" Sejak Lahirnya Permen ATR/Ka. BPN RI Nomor 5 Tahun 2020 tentang Pelayanan Hak Tanggungan Terintegrasi secara Elektronik’, [Online] accessed through <>.

[7]Pandam Nurwulan SH MH, “Hak Tanggungan Elektronik Berlaku Nasional. PPAT dan Kreditor, Siapkah?”, [Online] accessed through <>

[8]Technical Guidelines No. 2/Juknis-400.HR.02/IV/2020 of 2020 Concerning Technical Guidelines for Electronically Integrated Mortgage Rights Services, pg. 44