Encouraging The Utilization Of The MSME Empowerment Program, The Government Has Salurkan KUR Amounting To Rp255 Trillion

Coordinating Minister for Economic Affairs (Menko) Airlangga Hartarto. (Photo: Doc. ANTARA)

JAKARTA - The government continues to encourage the acceleration of the distribution of People's Business Credit (KUR) as one of the strategies in maintaining economic growth.

As of December 26, 2023, KUR has been distributed Rp255.8 trillion to 4.57 million debtors with the Non-Performing Loan (NPL) level maintained at the level of 2.03 percent, below the national gross NPL average of 2.42 percent.

Coordinating Minister for Economic Affairs Airlangga Hartarto said that in line with the government's commitment to continue to expand formal access to financing for MSMEs, the KUR program has transformed into an entry point for MSMEs in the formal financial ecosystem.

This is reflected in the increasing quality of KUR distribution, where as of August 31, 2023, the portion of new KUR debtors (for the first time KUR access) increased to 70 percent of the total KUR debtors in 2023 and 53 percent of KUR debtors in 2023 were debtors who rose the class of financing (graduation debtors).

Airlangga conveyed that through the Indicator, the improvement in the quality of KUR distribution shows that the purpose of changing KUR policies in 2023 to expand access to financing and increase the business capacity of MSMEs can be implemented properly.

"Combination between the KUR program, Alsintan Business Credit and Farmer Cards can ease the burden on our farmers in meeting the capital needs of agricultural production, therefore all parties need to support and play an active role in improving the welfare of farmers," he said while chairing the Coordination Meeting of the Financing Policy Committee for MSMEs virtually on Thursday, December 28.

Airlangga explained, in order to increase the graded KUR debtor and encourage the expansion of access to financing for MSMEs by distributing KUR to prospective new debtors, since 2023 the government has applied interest rates/saturated margins for repetitive KUR debtors.

In addition, the government has also prepared changes to the Regulation of the Coordinating Minister for Economic Affairs concerning Guidelines for the Implementation of KUR in 2024.

One of the policies that are ready to be implemented is repeated Micro KUR access for farmers with limited processed land area, which is at most 20,000 m2.

Incentives for small farmers who receive KUR are given an exception to the provisions for limiting access to Micro KUR (KUR ceiling of Rp. 10 million to Rp. 100 million) and the imposition of a fixed interest rate/Micro KUR margin of 6 percent.

This is to improve the welfare of farmers, by helping to provide access to low-cost financing so as not to burden them in preparing working capital to be able to produce.

It is hoped that this change in KUR policy can be utilized by the majority of farmers in Indonesia