IDR 2.506 Trillion in Credit Funds 'Idle' at Banks, OJK Explains the Phenomenon

The Head of Banking Supervision at the Indonesian Financial Services Authority (OJK), Dian Ediana Rae, stated that the phenomenon of ‘undisbursed loan’, or idle credit funds, which is prevalent in private banks, is a common occurrence in the banking business cycle.

Data from Bank Indonesia (BI) shows that the amount of undisbursed loan has reached IDR 2.506.47 trillion as of January 2026.

According to him, this condition often recurs from year to year. This is because debtors who have signed credit agreements usually already have expansion plans. However, the actual disbursement of funds still depends on business calculations and assessments of the economic situation.

“If we look at it, I think it’s something normal that happens every year. Business owners will look for opportunities,” said Dian in the Sudirman area, Jakarta, on Thursday, February 26, 2026.

He explained that the decision to draw down credit is greatly influenced by the business climate, investment prospects, and global and domestic dynamics. Therefore, the large amount of undisbursed loan does not necessarily reflect weak credit demand, but rather part of the debtor’s business strategy in managing expansion.

Dian said that the OJK has recorded a significant increase in credit last month, especially in the corporate segment. Meanwhile, BI recorded a credit growth of 9.96 percent year-on-year (yoy) in January 2026, with third-party fund (DPK) growth reaching 13.5 percent (yoy).

Regarding the micro, small, and medium enterprise (MSME) sector, Dian believes that further efforts are needed to optimize its growth.

“So, we do see that last month there was a significant increase, especially in the corporate sector. MSMEs still need to be encouraged. But this is certainly not impossible,” he said.

In the future, the authorities hope that improvements in global and domestic conditions will encourage more expansive credit distribution. Several strategies that have been prepared by the regulator are expected to start having an impact in the coming months. (Ant).