JAKARTA | Perum Jamkrindo, a State-Owned Enterprise (BUMN) assigned as the Implementing Institution for the Warehouse Receipt System Guarantee (LPP-SRG) as mandated by Government Regulation No. 1 of 2016 on LPP-SRG, has declared its readiness to carry out its duties as an SRG guarantee institution and play a role in maintaining commodity price stability.
Perum Jamkrindo President Director Diding S. Anwar stated that during the harvest season, the prices of several commodities tend to drop due to the surplus of harvested goods flooding the market.
"Through LPP-SRG, prices can be stabilized because part of the harvest is stored in warehouses, preventing an oversupply in the market," said Diding at a national seminar themed "Enhancing SRG Trust through Guarantee Institutions" in Jakarta, Wednesday (1/6/2016).
The event was attended by Minister of Trade Thomas T. Lembong, Chairman of the Financial Services Authority (OJK) Board of Commissioners Muliaman Hadad, and Chairman of the Commodity Futures Trading Regulatory Agency Bachrul Chairi.
Furthermore, Diding stated that for the guarantee industry, guaranteeing the Warehouse Receipt System (SRG) presents a business opportunity.
Its role is to guarantee the risk of loss in case of failure by warehouse operators to fulfill their obligations to return stored goods as specified in the Warehouse Receipt System (SRG).
"Perum Jamkrindo will function to guarantee the goods stored by warehouse operators," said Diding.
As LPP-SRG, the institution guarantees the rights and interests of Warehouse Receipt (RG) holders or guarantee right recipients against failure, negligence, or inability of warehouse operators to fulfill their obligations in storing and delivering goods as stated in the Warehouse Receipt.
With the existence of LPP-SRG, it is expected that business actors (Warehouse Receipt holders, banks, and warehouse operators) will have increased trust in the integrity of the SRG.
Thus, all business actors, from large-scale (traders, processors, exporters, and plantation companies) to small-scale (farmers, farmer groups, farmer group associations, and cooperatives), will feel protected by utilizing the SRG.
In a short time, it is hoped that the number of business actors involved, the volume of goods stored in warehouses, and the amount of credit disbursed by banks will increase rapidly. Commodities that can be stored by warehouse operators under the SRG include paddy, rice, corn, coffee, cocoa, pepper, rubber, seaweed, rattan, and salt.
Currently, a total of 117 warehouses have been approved as SRG warehouses, with 91 of them having issued warehouse receipts. These warehouses are spread across 19 provinces, including Aceh, West Sumatra, North Sumatra, Lampung, Banten, DKI Jakarta, West Java, Central Java, DI Yogyakarta, East Java, South Kalimantan, South Sulawesi, West Nusa Tenggara, Central Kalimantan, Southeast Sulawesi, West Sulawesi, Central Sulawesi, Bengkulu, and Bali.
SRG is also implemented in several other countries such as the United States, Hungary, Slovakia, Kazakhstan, Serbia, Croatia, and Bulgaria. Bulgaria enacted the SRG Law in 1998, covering commodities such as wheat, corn, rice, and sunflower seeds.
To promote SRG, the Bulgarian government provides subsidies for warehouse management costs to farmers storing their commodities in warehouses and offers low-interest bank loans.
With the issuance of Government Regulation No. 1 of 2016, for the first time, the funding source for the Implementing Institution of the Warehouse Receipt System Guarantee is derived from the State Budget as state equity participation, which is regulated by a separate Government Regulation.
The amount of State Equity Participation is IDR 705 billion, of which IDR 82 billion will be used for Jamkrindo’s operational activities.
Perum Jamkrindo, as LPP-SRG, has submitted a Business Plan detailing the Guarantee Fund and Operational Fund requirements for LPP-SRG. The Implementing Institution began its guarantee activities for the Warehouse Receipt System upon receiving capital from the government, as stated in Article 9, paragraph (2) of Government Regulation No. 1 of 2016.
Perum Jamkrindo, in accordance with Law No. 1 of 2016 on guarantees, is supported by banking institutions and financial institutions or non-financial institutions to provide credit, financing, Sharia-based financing, or service contracts to MSMEs.
Jamkrindo is always ready to contribute by absorbing the financing risks disbursed by banking and non-banking institutions to MSMEs through its credit guarantees. So far, in addition to guaranteeing credit programs such as KUR, guarantee companies have also provided credit guarantees for non-KUR MSME loans disbursed by banking institutions. (Public Relations)