BI Detects Credit Distribution Starts To Move, Investment And Consumption Are The Drivers

Illustrated. (Irfan Meidianto / VOI)

JAKARTA - Bank Indonesia (BI) said that new credit disbursement will increase in the first quarter of 2021. This projection was revealed after the monetary authority found the results of a banking survey which stated that the weighted net balance (SBT) of new credit disbursement in the first quarter of 2021 was 49.4 percent, an increase from the fourth quarter of 2020 which was 25.4 percent.

"It is estimated that new credit disbursement in the first quarter of 2021 will be driven by working capital loans, followed by investment credit and consumption credit," said Head of the BI Communication Department Erwin Haryono in a press release, Tuesday, January 19.

Meanwhile, credit growth in the fourth quarter of 2020 is estimated to remain limited, influenced by growth in investment credit. Meanwhile, the standard of lending in the first quarter of 2021 is not expected to be as strict as the previous period.

This is indicated by the Lending Standard Index (ILS) of 0.4 percent, lower than 3.2 percent in the previous quarter.

"Aspects of disbursement policies that are not expected to be as tight as the previous quarter include the credit ceiling and credit period," he said.

Furthermore, the survey results indicate that respondents are still optimistic about credit growth for the entire 2021 period.

"Respondents estimate that credit growth in 2021 will be 7.3 percent on an annual basis. This optimism is driven, among others, by monetary and economic conditions, as well as the relatively manageable risk of lending," Erwin said.

Separately, the Financial Services Authority (OJK) revealed that bank credit growth was known to have contracted to minus 2.41 percent. This figure is very different from the performance of Islamic banking financing which is still growing by 9.5 percent.

Meanwhile, the four state-owned banks that are members of the State Bank Association (Himbara) were only able to slightly increase by 0.6 percent.