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The Simple Interest Loan Contract is a fundamental financial instrument used in Indonesian business and personal transactions, governed by Indonesian law and regulations. This document is essential when parties wish to establish a straightforward lending arrangement using simple interest calculations rather than compound interest, making it particularly suitable for short to medium-term loans. The agreement ensures compliance with Indonesian Civil Code (KUHPerdata) and Financial Services Authority (OJK) regulations while protecting both lender and borrower interests. It's commonly used by banks, financial institutions, and private lenders for business loans, personal financing, and asset acquisition, containing all necessary provisions for loan amount, interest calculation, repayment terms, and default mechanisms.

1. Parties: Identifies and provides full details of the Lender and Borrower, including registration numbers for companies or ID numbers for individuals

2. Background: Brief context of the loan arrangement and the parties' intention to enter into this agreement

3. Definitions: Defines key terms used throughout the agreement including 'Interest Rate', 'Principal Amount', 'Repayment Date', etc.

4. Loan Amount and Purpose: Specifies the principal amount of the loan and its intended use

5. Interest Rate: Details of the simple interest rate and calculation method

6. Repayment Terms: Specifies repayment schedule, payment methods, and due dates

7. Representations and Warranties: Standard declarations by the Borrower about their capacity and authority to enter into the agreement

8. Events of Default: Lists circumstances that constitute default and the consequences thereof

9. Notices: How formal communications between parties should be made and delivered

10. Governing Law and Jurisdiction: Confirms Indonesian law as governing law and specifies jurisdiction for dispute resolution