Assistance to increase production quality must follow the distribution of smallholder business credit (KUR) from state-owned banks to entrepreneurs of micro, small, and medium enterprises (MSMEs), Minister of State-owned Enterprises (SOE) Erick Thohir said.

He pointed out that state-owned Bank Mandiri focusing on MSMEs in urban centres, has approached small food stalls popular among workers for lunch. Food quality sold at the food stalls must be maintained to ensure the food are healthy for the workers, the minister said.

“The majority of small food stalls, some 60 per cent of them, are flocked by informal workers who are paid on a daily attendance basis. If they are ill, what does that means? It means their family will not eat on that day,” Thohir stated at Padjadjaran University, here on Sunday.

Government-owned banks must assist MSMEs, particularly those active in the culinary sector, in obtaining quality materials for their food, he said.

“We must not let them purchase low-quality food materials because of capital shortage,” the minister noted.

Thohir then pointed out that as some 74 per cent of Indonesian residents predicted to relocate from villages to cities by 2045, assistance to MSMEs in cities must be optimised.

“Despite we direct Bank Mandiri to focus on corporations, that does not mean the bank will abandon MSMEs in favour of major corporations, no. Bank Rakyat Indonesia (BRI) will focus on MSMEs in villages, while Bank Mandiri will focus on urban MSMEs,” he said.

He informed that Rp260 trillion (US$17.4 billion) business credit, out of the Rp338 trillion (US$22.6 billion) KUR distribution target, has been channelled to MSMEs nationwide.

“We are currently attempting to gradually increase the distribution target to 30 per cent, and we hope it continues increasing to 50 per cent, just like in neighbouring countries,” Thohir remarked.

Source: Antara News