Jokowi Gives 'Red Carpet' To MSMEs, Gets Cheap Funding

JAKARTA - President Joko Widodo (Jokowi) remains fully committed to supporting micro, small and medium enterprises (MSMEs) in the country.

This was stated by Jokowi at the MPR Annual Session today at the Senayan Parliament Complex, Jakarta.

According to Jokowi, the government has proven this through various low-cost funding assistance that continues.

"The display of MSME products in the government's E-catalog is expected to absorb MSME products. At the same time, the obligations of the State Budget, Regional Budget, and SOE to purchase domestic products will also continue to be disciplined", he said on Tuesday, August 16.

Jokowi added that MSMEs must continue to be supported so that they can immediately advance to class. He said the digitalization of the economy which has given birth to two Decacorns and nine unicorns will continue to be encouraged to help empower MSMEs.

"There are 19 million MSMEs that have entered the digital ecosystem and it is targeted that 30 million MSMEs will enter the digital ecosystem by 2024", he said.

For information, the government relies on the People's Business Credit (KUR) program as a way to channel capital for grassroots sector entrepreneurs in developing businesses.

Through this scheme, MSME actors only need to pay a low-interest fee of 6 percent.

In fact, during the pandemic, the fiscal policy allows KUR debtors to only need to meet 3 percent interest because the other 3 percent is subsidized by the government until next December.

If MSMEs cannot access KUR because they are not visible to the bank, various other similar schemes are provided.

The program in question is ultra-micro financing (UMi) which is channeled through non-bank financial institutions (NBFIs), such as PT Pegadaian, PT Permodalan Nasional Madani, and PT Bahana Artha Ventura whose funding sources come from the state budget.