Low-interest loans to poor will be paid by January<\/p>\n
PALU, Central Sulawesi (JP): The government hopes to complete
\nby next January the first stage of its new poverty alleviation
\nprogram, which involves administering low-interest loans to 12
\nmillion Indonesians for starting their own businesses.<\/p>\n
Under a scheme called People's Prosperity Business Credit
\n(Kredit Usaha Kesejahteraan Rakyat, or Kukesra), families will
\ninitially receive a modest sum of Rp 20,000 (US$8.70), which will
\nmultiply each time it is repaid within four months.<\/p>\n
State Minister of Population Haryono Suyono said on Tuesday
\nthat officials have begun administering the loans.<\/p>\n
From April to June, the first group of 5 million people will
\nreceive the loans, said Haryono, following a ceremony here during
\nwhich he presented loans to 10 families. \"By January, all of the
\n11.8 million people will have received the loans,\" he said.<\/p>\n
President Soeharto administered a Rp 100 billion (US$44
\nmillion) loan last January to launch the program, which is now
\nbeing supervised by Haryono's office.<\/p>\n
The program is the second initiated by the President,
\nfollowing his Presidential Aid for Backward Villages (IDT)
\nprogram, which aimed at attacking poverty at its roots.<\/p>\n
The IDT, launched in April 1994, covers areas with large
\nnumbers of poor people. Villages not covered by the IDT program
\nwill have access to the Kukesra program.<\/p>\n
Government figures show that as many as 26 million Indonesians
\nare currently living below the official poverty line.<\/p>\n
The Kukesra program is an extension of the government's
\nPeople's Prosperity Savings campaign, which was designed to
\nencourage poor people to take up the habit of saving money.<\/p>\n
Selected Takesra participants must have savings of at least Rp
\n2,000 to qualify for an initial loan of Rp 20,000.<\/p>\n
The borrowers must repay the loan within four months, and
\nstrive to double their savings during that period to Rp 4,000.<\/p>\n
During the second round, they will be entitled to loans
\namounting to Rp 40,000. The credit ceiling will gradually
\nincrease in line with the growth of their business.<\/p>\n
\"By May 2,000, all of them are expected to receive the fifth
\nstage of the loan, which is Rp 360,000. They can repay it within
\na year,\" Haryono said.<\/p>\n
The government has appointed Bank BNI 46 to handle the loans.
\nThe bank will work with PT Pos Indonesia -- the state post office
\ncompany -- whose branches in nearly every village in the country
\nposition it perfectly to distribute the funds. (31)<\/p>",
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