Target Pangkas 600 BPR Until 2027, OJK Prepares Rules

Illustration (Photo: Doc. Antara)

JAKARTA - The Financial Services Authority (OJK) plans to streamline the number of People's Economy Banks (BPR) in Indonesia, which currently number 1,600.

OJK Banking Supervision Chief Executive Dian Ediana Rae said that his party continues to encourage BPR to consolidate so that the number of BPRs can be reduced.

He targets to reduce BPR to 1,000 BPR units by 2027.

"It's been too much and we actually can withstand the reduction of BPR so that around 1000 in 2027 it is very possible," he said at a virtual press conference for the RDK for August 2023, which was held virtually, Tuesday, September 5.

Dian explained that this was done not only to close the BPR, but because there were findings in the field, one person managed five BPRs so that they were considered ineffective.

"Say there are 5 BPRs or 10 owned by one group. And we don't allow it anymore," continued Dian.

OJK requires BPRs that are only owned by one person to merge.

He emphasized that the OJK gave the option of voluntary and forced mergers through the rules that will be issued by the OJK.

It is known, if currently OJK is focusing on implementing the "single price policy" rules for BPR which will prohibit one group from controlling more than one BPR.

Dian ensured that this policy had clear incentives because it allowed BPR to expand.

"What used to be their movement was limited in certain areas, now those offices that were merged can be used as branch offices and that will improve the performance of BPR from finances and credit and maintenance expansions will be better," concluded Dian.