FOR ECONOMIC AFFAIRS OF THE REPUBLIC OF INDONESIA PRESS
RELEASE HM.4.6/503/SET. M.EKON.3/12/2021
Economic Drivers of Jakarta, December 29, 2021
Welcoming 2022, the Government believes that Indonesia is in good momentum for the acceleration of national economic recovery and is an opportunity to expand business financing to Micro, Small and Medium Enterprises (MSMEs) through People's Business Credit (KUR) so that business activities strengthen and encourage economic growth.
The Coordinating Ministry for Economic Affairs through the Secretariat of the Financing Policy Committee for MSMEs, Wednesday (29/12), held a Coordination Meeting to evaluate the implementation of KUR distribution in 2021 and decided on various policies that will be the basis for the implementation of the KUR program in 2022.
"KUR is needed in accelerating economic recovery during the Covid-19 pandemic, so there is a need to increase the KUR ceiling and ease kur requirements," said Coordinating Minister for Economic Affairs Airlangga Hartarto as Chairman of the Financing Policy Committee for MSMEs.
Furthermore, in the Coordination Meeting of the Financing Policy Committee for MSMEs, the KUR ceiling in 2022 was increased to Rp373.17 trillion with a fixed KUR interest rate of 6%.
Considering the downward trend in cost of fund and the increase in efficiency of Over Head Cost (OHC) kur rates, the Government also lowered kur interest subsidies in 2022 for Super Micro KUR by 1%, Micro KUR down 0.5%, and PMI kur down 0.5%.
In order to accelerate economic recovery, especially MSMEs, the Government set several kur policy changes, including changes to the micro KUR ceiling (without additional collateral) which was previously above Rp10 million s.d. Rp50 million becomes above Rp10 million s.d. Rp100 million, changes in special KUR/cluster without restrictions on the accumulation of KUR ceiling for the production sector (non-trade), changes in KUR policy of Placement of Indonesian Migrant Workers (PMI) including adjustment of the PMI Placement KUR ceiling from a maximum of Rp25 million to a maximum of Rp100 million, as well as changes and extensions to the relaxation of KUR policies during the Covid-19 pandemic.
The relaxation of kur policy referred to above consists of a small KUR without restrictions on the accumulation of kur ceiling s.d. December 31, 2022, delay of production sector target s.d. December 31, 2022 or in accordance with the consideration of the Financing Policy Committee for MSMEs, Further incentives in the form of extension of KUR restructuring, administration relaxation for prospective KUR debtors during the Covid-19 pandemic based on objective assessment of KUR distributors.
"Through kur policy changes, the government shows great concern to MSMEs by providing kur requirements that are easier and more affordable so that MSMEs can optimize their role as national economic drivers," said Minister of Airlangga.
The relaxation of KUR policy has affected KUR demand which has exceeded its normal pattern and contributed to economic growth. KUR demand showed an increase from an average per month of Rp11.7 trillion in 2019 (pre-Covid-19 pandemic) to Rp16.5 trillion in 2020 and Rp23.7 trillion in 2021.
Overall, the realization of KUR from January 2021 to December 27, 2021 has reached Rp278.71 trillion or 97.79% of the 2021 target change of Rp285 trillion, and until the end of 2021 it is estimated that KUR distribution can be realized by 99% of the 2021 target.
The realization of KUR in 2021 has been distributed to 7.35 million debtors with a total outstanding KUR since August 2015 amounting to Rp373.35 trillion. With the target of distributing KUR in the production sector in 2021 which was delayed by the Financing Policy Committee for MSMEs, the distribution of KUR production sector in 2021 has reached 55.17%.
Based on the Results of the Coordination Meeting of the Financing Policy Committee for MSMEs on November 12, 2019, the KUR ceiling target in 2021 of Rp220 trillion increased to Rp253 trillion based on the request of KUR distributors. Given the demand for additional ceilings from KUR distributors, the KUR ceiling in 2021 was increased again to Rp285 trillion. The government decided to increase the KUR ceiling in 2022 with the consideration of economic growth needs to continue to be encouraged through strengthening MSME actors as pillars of the national economy. (D1/map/fsr)
Bureau of Communication, Information
and Trial of Coordinating Ministry for Economic Affairs Haryo Limanseto