Deputy Chair of Commission XI Discusses Strengthening SME Credit in P2SK Law Revision
Jakarta (ANTARA) - Deputy Chair of Commission XI of the Indonesian House of Representatives, Fauzi Amro, has revealed discussions on strengthening SME credit distribution within the revision of the Financial Sector Development and Strengthening Law (P2SK), which is being prepared for deliberation with various stakeholders in the upcoming session.
“We will hold meaningful participation, discussing what kind of financing model is needed by SMEs now. The OJK regulation has been issued, banks have provided credit, liquidity has been supplied, but our SME credit is experiencing a slowdown,” said Fauzi when met by reporters after the “IPB Alumni Synergy for the Nation” event in Jakarta on Saturday.
He explained that in previous discussions, there was a proposal for consolidation in the national banking sector, although it has not yet been further discussed and will be revisited in the next session.
Fauzi highlighted the lack of clear regulations on the allocation of bank credit distribution, including for SMEs, so the division of roles among banks has so far operated more on a practical basis.
On the other hand, he assessed that various Financial Services Authority (OJK) policies, especially through OJK Regulations (POJK) related to easing access to financing, have not yet run optimally, as reflected in the slowdown in SME credit despite available bank liquidity.
Fauzi also reminded that SMEs have a large number of actors and make a significant contribution to the economy, both in terms of employment absorption and to GDP, but still face limitations in access to financing.
According to him, the involvement of the financial and banking sectors is important in supporting SME financing going forward.
When asked about the progress of discussions on the revision of the Financial Sector Development and Strengthening Law (P2SK), he said that discussions at the end of the previous session had actually been targeted for approval because several crucial issues were deemed resolved.
Fauzi mentioned several issues that are beginning to narrow down, including the demutualisation of the Indonesia Stock Exchange (BEI) to adjustments in the selection committee (pansel) for members of the OJK and Deposit Insurance Corporation (LPS) boards.
Regarding the completion target, he stated that the P2SK law revision is expected to be finalised in the current session in May.
“(Target) session completed. This session runs until 12 May. This is a long session period. We will complete it in the current session,” said Fauzi.