cicilan

Cicilan is an Indonesian term for installment payments—a system in which a borrower or buyer pays for a debt or purchase in regular installments over a set period rather than in a lump sum. Each installment typically covers part of the principal and interest or fees, with a specified due date, usually monthly.

The term derives from the Indonesian verb cicil, meaning to do in small parts; cicilan is widely used in consumer finance, retail purchases, vehicle loans, mortgages, and online financing. Installment plans can be offered by banks, financial institutions, or retailers and may require a down payment. They may come with promotional 0% interest or with standard interest rates. Some programs are tied to credit cards or to in-house financing, while others allow payment without a credit card.

Calculation and terms: Installments are scheduled to amortize the loan over the term; the monthly payment is designed to repay both principal and interest. The exact payment depends on the loan amount, interest rate, term, and any applicable fees. Consumers should compare total cost, including interest and fees, rather than just the monthly payment. Advantages include enabling purchase of expensive items and better budgeting; disadvantages include higher total cost, risk of over-indebtedness, and potential penalties for late or early repayment.

See also: angsuran, credit, loan, financing.