The Financial Service Authority (OJK) supported Government’s plan to broaden scope of distribution of people’s Credit (KUR) to new business lines, start up business, including various creative industry sector and technology-based industries.
Naturally not just the scope would be broadened but number of banks would be increased as well, hopefully to include Provincial Development Bank (BPD)” this was stated by the Chairman of the Board of Commissioners of OJK Muliaman D, Hadadafter attending limited meeting on KUR at the President office on Monday.
However Muliaman remained that the targeting be done selectively with reference to recipient’s performance of last year.
OJK also insisted that pipelining of KUR not to involve big Government’s banks but also to include other financial institutions.
Not only BPR, but other financial institutions like financing agencies, cooperatives, etc be authorized to distribute KUR. The expansion was not only by area but also on the basis of linkage principle to expand absorption while still stressing on prudence.
With expansion of industrial areas, and change in distribution mode, the KUR program was expected to be maximized this year. “next year, as the Government planned to increase the distribution mode by quantity, with foundation which was more accommodative, the absorption could be expected to by higher next year” Muliaman remarked.
Sometime ago at the limited meeting on People’s Business Credit President Jokowi insisted on making breakthrough in accelerating KUR because according to data realization of credit was still low. President Jokowi expected in the next 3 months: October, November, December there would be significant breakthrough. “Small business must be protected and strengthened to strengthen their competitiveness.”
President Jokowi said that by 2015. The Government had around Rp.30 trillion for KUR to be distributed to small business, with credit interest reduced from 22% to 12%. (SS)
Business News - October 9, 2016