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Jakarta Post

Ministry guarantees loans for MSMEs

  • Adrian Wail Akhlas

    Jakarta

Jakarta   /   Fri, July 3 2020   /  01:00 am
A craftsman checks guitars at a home industry in Klapanunggal, Bogor regency, West Java, on March 28, 2020.(Antara/Yulius Satria Wijaya)

The government has unveiled a new rule to guarantee working capital loans for micro, small and medium enterprises (MSMEs) in a bid to boost credit disbursement from banks, as risk aversion increases amid the COVID-19 pandemic. Finance Ministry Regulation (PMK) No. 71/2020 published on Monday stipulates that the government will assign state-owned credit insurer Jaminan Kredit Indonesia (Jamkrindo) and state-owned insurer Asuransi Kredit Indonesia (Askrindo) to provide guarantees for banks to channel loans to MSMEs. The government has allocated Rp 12 trillion (US$839.07 million) to guarantee working capital loans, which consists of Rp 10 trillion for guarantee services and another Rp 2 trillion in reserves. Finance Minister Sri Mulyani Indrawati said the government would soon implement the insurance scheme, adding that the policy aimed at pushing banks to channel more loans to MSM...