BI Rate Rises to 5.75%, Danantara Urges State Banks to Boost Efficiency and Productivity

The increase in Bank Indonesia’s benchmark interest rate to 5.75% must not hinder credit distribution to the business sector and MSMEs, the government has stressed through the Danantara Investment Management Agency. Minister of Investment and Danantara CEO Rosan Roeslani stated that the rate hike should be viewed comprehensively and not used as a reason to tighten lending. Speaking after a meeting with President Prabowo Subianto at the Presidential Palace complex in Central Jakarta on Thursday, 18 June 2026, Rosan said, “Yes, it must be seen as a whole. The BI rate has risen, but the most important thing is how banks continue to improve their efficiency and productivity.” He noted that the national banking industry remains in a strong condition, with lending growing significantly over the past year. “From 2025 to 2026, our bank lending has increased by an average of 15%,” he said. In addition to credit growth, banking liquidity remains solid, with third-party funds growing at a double-digit pace and non-performing loan (NPL) ratios staying low. He cited Bank Mandiri’s NPL at just 0.9%, while the average NPL for state-owned banks (Himbara) currently ranges between 0.9% and 1.8%. Rosan emphasised that there is still ample room to improve efficiency so that the benchmark rate increase does not lead to tighter access to financing for the public and businesses. “These are precisely the things that must be improved and made more efficient, so that despite the rate hike, lending to the public and to businesses, especially MSMEs, can be maintained at a good level, at the same level,” he asserted.