BRI Boss Reveals Challenges And Opportunities For Ultra Micro Holding

Illustration (Photo: Doc. BRI)

JAKARTA - President Director of PT Bank Rakyat Indonesia Tbk. (BRI) Sunarso said that his party as the holding company for the ultra micro has prepared a special strategy to overcome challenges as well as capture business opportunities to spur the performance of the two entities under the company, namely PT Pegadaian and PT Permodalan Nasional Madani (PNM).

Sunarso, who has also led Pegadaian, said that the challenge for BUMN providing pawn services was too big to stand alone and must continue to run its core business in order to survive.

According to him, in the midst of disruption due to fintech and fiduciary, there is a threat because it offers faster and more efficient financial services at lower interest rates. For this reason, the realization of the establishment of an ultra micro holding is expected to be able to overcome this challenge.

“Pegadaian can focus more on handling mortgage loan services more efficiently. Then with that, the capacity can be enlarged, in the core competency it is pawned. I think that is Pegadaian's strategy going forward," he said in an official statement as quoted on Wednesday, July 22.

As for PNM, it will continue to focus on its business base group lending, through fostering the community to do business commercially or empowering people at the lower levels. PNM is targeted to keep looking for as many people as possible who can be guided, taught, assisted to do business.

"Then the reality is that what PNM has touched is those that are not yet visible and those that are not bankable. This is what we will push into the ecosystem, if possible, as much as possible,” he said.

Sunarso added that ultra micro business actors who received PNM assistance were then given pawn-based financing facilities. If they are considered to have good prospects, they will be offered larger funding services through BRI. This ecosystem is trying to be explored and formed through the establishment of an ultra micro holding.

“So PNM's most important strategy is to provide and become a provider of growth sources. This holding process is not a merger, so nothing has changed in each entity, both PNM and Pegadaian. But strengthening and synergizing their respective business models," he said.

Furthermore, the BRI boss explained that the challenge in running a business in the micro and ultra micro segments is high operational costs. This is because quite a lot of people and networks are involved to provide services.

In addition, Sunarso said, human error and operational risk management are also getting higher. Through holding ultra micro these challenges can be overcome with an integrated strategy.

"Through the formation of this holding, we want to realize collaboration and digitalization which will reduce two things, operational costs and operational risk which will decrease," Sunarso concluded.