Finance Ministry calculates changes to KUR interest subsidy to 5 percent

Jakarta (ANTARA) - The Ministry of Finance (Kemenkeu) is currently calculating changes to the interest subsidy budget for People’s Business Credit (KUR) to fulfil the directive from President Prabowo Subianto to lower the KUR interest rate to a maximum of 5 percent. As a note, the current KUR interest rate is set at a flat 6 percent. Acting Director General of Budget at the Ministry of Finance, Sudarto, explained that the reduction in the interest subsidy amount will also change the budget allocation. “Currently, the allocation for the interest subsidy is Rp36 trillion. The change from 6 percent to 5 percent has already been calculated by us. We will soon submit it,” said Sudarto during the APBN KiTa April 2026 press conference at the Ministry of Finance office in Jakarta on Tuesday. President of the Republic of Indonesia Prabowo Subianto announced plans to disburse KUR with a maximum interest rate of 5 percent per year to improve the welfare of small-scale citizens during the International Labour Day commemoration at the National Monument (Monas) in Jakarta on Friday (1/5). “I have instructed the state-owned banks that soon we will disburse KUR at a maximum of 5 percent per year,” said President Prabowo. The President explained that the policy is being taken because small-scale citizens, including workers, farmers, and fishermen, have often been trapped by very high loan interest rates. According to him, people’s income should not be exhausted just to pay burdensome loan interest. “So far, small-scale people, when borrowing money, the interest is extraordinarily high. Small people borrowing money can have interest up to 70 percent per year,” said Prabowo. The President also paid attention to the tenor that facilitates workers in paying off mortgages (KPR), to make it more flexible and long-term.