Bank Mandiri makes loan to farmers

YOGYAKARTA: In cooperation with Sleman regency government, Yogyakarta's branch of Bank Mandiri is providing soft loans to tobacco farmers in Padasan village, Pakem, in the regency, in the hope of increasing the wealth of local farmers.

The contract was jointly signed in a modest ceremony held in the village on Tuesday between Yogyakarta Bank Mandiri's head of credit affairs Tri Prasetyo and head of Ngesti Makmur farmers' association Sudi Utomo.

According to head of Sleman's horticultural office Djadjar Sudarno, the local government recommended the bank provide credit to some 89 families at a total loan value of some Rp 1.5 billion, with interest of 9 percent per year, far below the market rate of 18 percent to 22 percent. However, due to technical considerations, only Rp 985 million was approved.

"This is the first of its kind. We plan to expand the scheme to other villages in the region," said Djadjar.

Sleman Regent Ibnu Subiyanto expressed hopes the scheme would significantly increase farmers' per capita income. -- JP