JAKARTA - The Indonesian government has revised the guidelines for the distribution of Kredit Usaha Rakyat (KUR), effective as of January 1, 2018. One of the key changes is the reduction of the annual interest rate from 9% to 7%.
Deputy for Macro Economy and Finance Coordination at the Ministry of Economic Affairs, Iskandar Simorangkir, stated that the new guidelines are outlined in the Coordinating Minister for Economic Affairs Regulation (Permenko) No. 11 of 2017, which replaces the previous regulation that took effect on January 1, 2018.
"This regulation is a replacement for the previous one, which is effective starting January 1, 2018," Iskandar said in a statement on Monday (29/1/2018).
In addition to the interest rate reduction, other changes to the KUR distribution guidelines include the minimum allocation for production sectors, the introduction of a "yarnen" mechanism (credit repayment after harvest), a grace period, and KUR provisions for communities in border regions.
Regarding KUR for the production sector, the target distribution for this sector in 2018 is a minimum of 50% of the total target of IDR 120 trillion. "This target is part of the government's effort to support food security policies and the downstream industry for MSMEs," he explained.
Throughout 2017, the total KUR distribution reached IDR 96.7 trillion, an increase of 2.4% compared to 2016, which was IDR 94.4 trillion.
"Through KUR, the government will continue to strive to improve MSMEs' access to financial services through a guarantee scheme," he added. (Source: Kompas.com)