Debt Relief for MSMEs Extended to Non-Bank Institutions and State-Owned Enterprises

Debt Relief for MSMEs Extended to Non-Bank Institutions & State-Owned Enterprises

Jakarta, CNBC Indonesia - Commission XI of the Indonesian House of Representatives (DPR) together with the government have agreed on the Draft Law (RUU) on Amendments to Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector (P2SK). This P2SK bill will be ratified at a Plenary Session of the DPR today, Thursday (4 June 2026).

This P2SK bill will provide a legal basis for writing off bad debts of MSMEs at banks and state-owned and regional non-bank financial institutions without harming state finances.

Finance Minister Purbaya Yudhi Sadewa revealed that this is part of an agreement between the government and the DPR to jointly encourage the development of MSMEs as a driver of economic growth.

He affirmed that the scope of the policy on writing off bad debts to MSMEs, which has been regulated in the P2SK Law, will be expanded to include banks or state-owned and regional non-bank financial institutions.

In addition, he emphasized the need to relax the requirements for debt write-offs while still upholding the principle of prudence and considering the possibility of recovery from debtors.

“This bill also reaffirms that the losses from the write-off of bad debts are the responsibility of each bank or non-bank financial institution, whether state-owned or regional, and do not become a loss for the state,” said Purbaya.

Chairman of the Working Committee (Panja) of the P2SK Law Revision Bill, Mohamad Hekal, said that the write-off of MSME bad debts is one of the important substances agreed upon in the revision of the P2SK Law. According to him, this is a form of government policy to give MSME actors a second chance so that they can return to participating in economic activities.

“One of the things we can be proud of from this revision of the law is the write-off and debt relief for MSMEs, which has been very difficult,” said Hekal, Wednesday (3 June 2026).

According to the Deputy Chairman of Commission XI of the DPR, many business actors have difficulty developing their businesses because they are still burdened with old credit obligations that have not been administratively resolved.

“This condition not only hinders the productivity of business actors, but also has the potential to cause greater losses to the economy,” he said.

With this policy, the government will later have the space to resolve various credit problems that have hampered MSMEs. Thus, affected people can regain access to financing and other economic activities.

“With this law, we are given a legal basis so that we can carry out the write-off so that people who are affected by this problem can return to participating in the growth of the Indonesian economy,” said Hekal, quoted from the DPR RI website.

(haa/haa)