Government launches new credit scheme
JAKARTA (JP): The government launched a new credit scheme yesterday called Business Partnership Promotion Credit (KPKU) to help develop small businesses.
Coordinating Minister for People's Welfare and Poverty Eradication/Chairman of the National Family Planning Board Haryono Suyono said credit would be provided to help small businesses run by members of the government-sponsored prosperous family program (Prokesra).
The low-interest loans, however, would be given only to those people who have a partnership program with small and medium companies and cooperatives, he said.
"The credit will have a low interest rate and will available in every district and municipality, " Haryono said after signing a memorandum of understanding with Bank Indonesia and the Ministry of Finance on the loan facility.
The interest rate will be 12 percent per annum, much lower than the commercial rates of about 50 percent.
Haryono said that Bank Indonesia, the central bank, and the Ministry of Finance would, in the first phase, provide Rp 500 billion (US$58.8 million).
"In the first phase, the credit will be focused on helping poor people develop their own small business. Around Rp 5 billion will be used for the training program for over 65,000 members of Prokesra and over 7,000 field training officials," Haryono said.
The Prokesra program, introduced several years ago, aims to help poor people in both rural and urban areas.
The credit, he said, would be directly channeled through state banks Bank Negara Indonesia (BNI) and Bank Rakyat Indonesia (BRI) to every district and municipality throughout the country, which will initially receive a modest Rp 1 million to Rp 2 million, depending on the capability and the development of the area.
Haryono said the training programs would concentrate on improving the management of small and medium businesses, production and marketing techniques, and also aim to introduce a banking system.
In past years, the government channeled funds through organizations known as People's Prosperity Business Credit (Kukesra) and Prosperous Family Savings (Takesra) to help poor families start their own small businesses.
Prokesra funds are currently helping nearly five million families across the country.
Haryono said the funds would also be focused on improving the business ability of the members of the Kukesra and Takesra programs.
He said that every member of the Prokesra program could get up to Rp 2 million in credit, depending on their business performance.
Haryono said that the KPKU program would need at least Rp 3 trillion in the coming years; this is expected to be provided by the central bank along with private sources.
"Hopefully, the provision of this credit will keep alive the grassroots economy, especially in the midst of the country's current economic turmoil," he said. (gis)