Government Reaffirms KUR Loans Up to Rp 100 Million Require No Additional Collateral
The Ministry of Micro, Small, and Medium Enterprises (UMKM) has reaffirmed that applications for People’s Business Credit (KUR) with a ceiling of up to Rp 100 million do not require additional collateral. The government is urging the public to report any irregularities, such as requests for extra collateral, illegal fees, or the use of brokers in the KUR application process.
Deputy for Entrepreneurship and Spokesperson for the Ministry of UMKM, Riza Damanik, stated that the public does not need to use third-party services or pay any fees to access the KUR facility. “According to the KUR Implementation Guidelines, loans up to Rp 100 million are not subject to any form of additional collateral without exception,” Riza said in a written statement on Monday (3/8/2026).
Riza revealed that the ministry is still receiving reports regarding alleged requests for additional collateral from micro KUR applicants, as well as complaints about fees or rewards demanded during the loan processing. The Coordinating Ministry for Economic Affairs Regulation Number 1 of 2026 on KUR Implementation Guidelines stipulates that the programme is designed to expand financing access for productive and viable business actors who lack access to commercial credit.
“KUR is one of the government’s strategic programmes to strengthen the people’s economy through financing support for productive businesses that do not have additional collateral,” Riza explained. He detailed that the guidelines recognise two types of collateral: primary collateral, which is the business or object being financed along with the debtor’s repayment capacity, and additional collateral, such as land certificates, vehicle registration documents, or other personal assets.
Under these provisions, lending institutions are prohibited from requesting additional collateral for loans up to Rp 100 million. Additional collateral may only be applied to loans exceeding Rp 100 million, except for smallholder sugarcane farmers and recipients of special agricultural sector KUR who cooperate with credit guarantee institutions. “Prospective KUR recipients with loans up to Rp 100 million only need to use the primary collateral, which is the business being financed through KUR,” he clarified.
Through the KUR scheme, which receives subsidies from the State Budget (APBN), debtors are only charged an interest rate of 6 percent, significantly lower than commercial credit rates that typically range from 10 to 14 percent or more. Riza added that the government’s commitment to expanding financing access for MSME entrepreneurs is reflected in the KUR distribution target of Rp 290 trillion for 2026. According to the Ministry of Finance’s Credit Programme Information System (SIKP) data as of 22 July 2026, KUR realisation has reached Rp 169 trillion, distributed to 2.65 million debtors across Indonesia.
Of that total, approximately 1.1 million debtors are business actors accessing formal financing for the first time, while 511 thousand MSME entrepreneurs have experienced increased business capacity or have graduated to a higher level. KUR distribution is also increasingly directed towards strengthening productive sectors, with around 65 percent of the allocation flowing to agriculture, fisheries, processing industries, and other productive sectors that drive the people’s economy. Financing quality remains well-maintained, with a non-performing loan rate of around 2 percent.
To maintain the integrity of the KUR programme, the Ministry of UMKM invites the public to actively report any suspected irregularities, including requests for additional collateral or unauthorised fees. Reports can be submitted through SPAN-LAPOR! or via email at kur@ekon.site. Every report will be followed up in accordance with applicable regulations, including the imposition of sanctions if violations are found. Riza stressed that the government, together with all KUR distributing institutions, remains committed to strengthening programme governance to ensure it is easily accessible, well-targeted, transparent, and free from irregularities. Through this, KUR is expected to further strengthen MSME capital, expand job opportunities, reduce extreme poverty, and promote national economic independence.