Zulhas Ensures that Village Funds Are Not Collateral for the Red and White Cooperative

JAKARTA - Coordinating Minister for Food Affairs and Head of the Red and White Village Cooperative Task Force, Zulkifli Hasan, confirmed that village funds will not be used as collateral for the Red and White Village Cooperative (Kopdes Merah Putih)'s loan from the Himbara bank.

Zulhas, as Zulkifli Hasan is familiarly known, explained that in loan proposals, the collateral provided by the Kopdes is the nature of its business. For example, he said, if the loan is to be used for a gas business, then that asset will serve as collateral.

"Village funds do not serve as collateral; the guarantor is, for example, the gas itself, the collateral. For basic necessities, the basic necessities are used as collateral. So, the loan is spent on what is the collateral," he said in a press conference at the Coordinating Ministry for Food Office on Tuesday, August 5.

Zulhas stated that village funds will serve as the final guarantee in the event of violations or losses in the business run by the Red and White Village Cooperative.

"Meanwhile, if something happens to the village funds due to an error, or a violation, that will be used at the end," he explained.

Furthermore, Zulhas stated that if the village funds are used for the benefit of the Merah Putih Village Cooperative (Kopdes Merah Putih) by the management, they must be reimbursed.

"Village funds are what's called interception, so if the management uses the money, they must be reimbursed," he said.

Separately, Minister of Villages and Development of Disadvantaged Regions Yandri Susanto stated that the collateral for the Merah Putih Village Cooperative loan will be in the form of goods.

Furthermore, Yandri also stated that the funds or loans that will be disbursed will also be distributed directly to the distributors or businesses of the Kopdes.

"For example, if someone borrows capital for gas or basic necessities, that will serve as collateral to the bank. For example, if they borrow Rp 100 million for LPG, that Rp 100 million doesn't go to the Kopdes, it goes directly to Patra Niaga, which distributes the gas. So the Kopdes doesn't receive cash, but rather goods," he explained.

"Including fertilizer, for example, if someone needs Rp 50 million in fertilizer, the Rp 50 million doesn't go to the Kopdes (village cooperative) but is given directly to Pupuk Indonesia. The Kopdes then receives the fertilizer," he continued.

Yandri emphasized that with this scheme, the Kopdes doesn't receive money from the loan they apply for, but directly the goods that will become their business. According to him, with this scheme, the Kopdes won't suffer any losses.

"So, the Kopdes doesn't actually receive money directly from the Himbara Bank; they receive the goods, and then they profit from that. The bottom line is that it's impossible to incur losses.

But if there are losses, there must be a plan. That's what we're proposing in the Village Ministerial Regulation," he explained.