Government Issues Regulation for KPPS, Credit for Underprivileged Women at 8% Interest
Coordinating Minister for Economic Affairs Airlangga Hartarto, in his capacity as Chair of the Financing Policy Committee for Micro, Small, and Medium Enterprises (MSMEs), has officially issued Coordinating Ministry for Economic Affairs Regulation (Permenko) Number 7 of 2026. The regulation serves as the legal umbrella for the implementation of Kredit Perempuan Prasejahtera (KPPS), which was promulgated on 5 August 2026.
KPPS is a programme credit scheme that provides productive financing with a low interest rate or margin of 8% flat per annum. This programme is intended for women from underprivileged families who are currently running a business or are about to start one, with a loan ceiling of up to IDR 15 million per contract without additional collateral requirements.
Coordinating Ministry for Economic Affairs spokesperson Haryo Limanseto explained that the issuance of this regulation is a follow-up to President Prabowo Subianto’s directive to significantly reduce the financing interest burden for the most vulnerable groups in society.
“All this time, ultra-micro business actors, especially women from underprivileged families, have borne financing interest rates of around 24% per annum. Through KPPS, this burden is reduced to 8% flat per annum through government interest subsidy or margin subsidy support,” Haryo said in a statement on Thursday (13/8).
The government has set measurable programme targets. KPPS recipients must meet specific criteria. The Permenko also provides room for distributing institutions to objectively assess the eligibility of prospective recipients so that no one in need is left behind by this programme.
The KPPS scheme is designed according to the characteristics of ultra-micro businesses with specific provisions. Unlike other credit programmes, KPPS requires the provision of empowerment services. Distributors are obliged to provide mentoring, financial management education, and entrepreneurship training. In addition, a joint liability mechanism is applied to foster group solidarity. Recipients are also encouraged to independently become participants in BPJS Ketenagakerjaan for employment protection.
To maintain accountability, KPPS distribution is carried out by healthy financial institutions or cooperatives that are integrated with the Programme Credit Information System (SIKP). Supervision is conducted in layers by a coordination forum involving the Financial and Development Supervisory Agency (BPKP), technical ministries, and financial services sector authorities.
Haryo added that the Coordinating Ministry for Economic Affairs will immediately coordinate the preparation of derivative legal instruments and information systems so that the benefits of KPPS can reach a potential 9.16 million women ultra-micro business actors in Indonesia.
“This is in line with the financing justice agenda within the Asta Cita framework of President Prabowo Subianto’s administration,” he concluded.