Banks extend Rp118.4 trillion in smallholder business credits until November

Jakarta (ANTARA News) - The amount of smallholder business credits (KURs) extended until November 30, 2018, reached Rp118.4 trillion, or 95.7 percent of the target of Rp123.801 trillion for this year, the Coordinating Ministry for Economic Affairs stated.

The amount of non-performing loans reached 1.39 percent of the overall KURs extended, Deputy for Macro Economic and Financial Coordination of the Coordinating Ministry for Economic Affairs Iskandar Simorangkir stated here on Thursday night.

He has forecast that the amount of KURs still to be extended until the end of this year will reach Rp1.6 trillion to Rp2 trillion.

"We predict the realization of KURs for this year will be around Rp120 trillion. In fact, several banks received many applications for KURs at the end of this year, but they stopped the applications. Otherwise, the ceiling of KURs will be exceeded," he noted.

He said 65.7 percent of the KURs were extended under a micro KUR scheme, and 33.9 percent under a small KUR scheme, while 0.3 percent of the overall KURs were extended to Indonesian migrant workers.

In terms of regions, 55 percent of the KURs extended this year went to Java, 19.3 percent to Sumatra, and 11.1 percent to Sulawesi.

The government stepped up efforts to increase the amount of KURs extended to the production sector, including agriculture, fisheries, industry, construction, and services, to achieve the target of 50 percent for 2018. Until November 30, 2018, the target was 45.6 percent achieved.

If the amount of KURs extended by banks to the production sector is less than 50 percent, they will be subjected to a penalty that lowers an increase in the ceiling of KURs, he stated.

The penalty ranges from five to 30 percent of the total increase in the ceiling of KURs they have proposed, he added.

Source: ANTARA News

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