Indonesia Launches Kumitra Programme to Boost MSME Access to Modern Retail Markets

Yogyakarta (ANTARA) - No fewer than 800 kiosks belonging to micro, small, and medium enterprise (MSME) operators sell culinary products, handicrafts, and various fashion items at Teras Malioboro 1, an iconic building in the centre of Yogyakarta City. Bargaining between buyers and sellers at the handicraft and fashion kiosks is a daily sight at the MSME centre, which accommodates traders who previously sold their wares along the Malioboro street area.

On Friday evening (17/7), this strategic area for economic activity witnessed the launch of a government programme by the Ministry of MSMEs, namely the Ease of Micro Enterprises to Partner (Kumitra). The Kumitra programme connects MSME operators with strategic partners or modern retail entrepreneurs to broaden the market access for MSME products.

‘Kumitra is here to bring micro-enterprises together with various business partners and open up wider market access and supply chains,’ said Deputy Minister of MSMEs Helvi Yuni Moraza following the programme’s launch. The partnership programme, which collaborates with the Indonesian Retailers Association (Aprindo) overseeing around 500 modern retail partners nationwide, serves as a classic solution to the problem faced by MSMEs: market access.

The collaboration between MSMEs and modern partners will run for one year, with the expectation that MSMEs in various regions will be able to produce goods with good quality, quantity, and continuity, meeting the requirements to be marketed through retail channels. This step is expected to facilitate the entry of MSME products into modern retail partners by waiving listing fees or initial registration charges for new products.

The Ministry of MSMEs is targeting this partnership with modern retail markets to reach as many MSME operators in Indonesia as possible, given that the small-scale industry sector is also a focus of President Prabowo’s administration. In addition to strategic partners, the Kumitra programme also brings MSME operators closer to buyers, so that Indonesian micro, small, and medium enterprises no longer have to individually seek out parties to purchase their products.

From the meeting with MSME strategic partners, the government secured commitments from partners to collaborate with micro-enterprises worth IDR 7 billion. This initial commitment marks the beginning for MSMEs and modern retail markets to continue growing together and progressing in the days ahead.

To provide comprehensive and integrated services supporting the upgrading of MSMEs, three Integrated Business Service Centres for Cooperatives and Micro, Small, and Medium Enterprises (PLUT KUMKM) have been developed in the Special Region of Yogyakarta (DIY). The three PLUT KUMKM in DIY are located at Teras Malioboro Yogyakarta, Sleman Regency, and Kulon Progo Regency. This programme, initiated by the Ministry of MSMEs, serves as an integrated service to help MSMEs upgrade, ultimately increasing income and strengthening economic independence.

Various types of services available at PLUT KUMKM include business consulting, legality and licensing, financing and capital, marketing and digitalisation, training, partnerships and supply chains, as well as information to support MSME upgrading. Through these PLUTs, DIY, which has around 345,000 MSMEs, possesses significant potential to develop and enter wider markets, whether through modern retail networks, the tourism sector, the processing industry, or digital platforms.

Therefore, the Ministry of MSMEs is urging MSME operators in DIY to utilise the PLUTs, partnerships with retail entrepreneurs, and various government programmes to develop their businesses. The Ministry of MSMEs, through local governments and relevant agencies, is also present to assist MSME operators so they can grow, upgrade, and possess increasingly strong competitiveness at the national level.

As a productive economic endeavour run by individuals, households, or small-scale business entities, MSMEs have become one of the main pillars driving the wheels of the economy in Indonesia. Kumitra, of course, is inseparable from this reality. Referring to data from the Ministry of MSMEs as conveyed by Deputy Minister Helvi Yuni Moraza, there are currently approximately 59 million MSME operators spread across various districts and cities throughout Indonesia.

This figure makes the MSME sector, which involves nearly a quarter of Indonesia’s population, the primary driver of the Indonesian economy, as more than 60 per cent of Indonesia’s gross domestic product (GDP) originates from MSMEs. The growth and development of the MSME sector in Indonesia can also be described as a humanitarian struggle, in the sense that it brings a positive impact on the welfare of the people directly involved. This is because MSMEs can solve two humanitarian problems at once that are of concern to the government: poverty alleviation and job creation.

To strengthen the capital of MSME operators in Indonesia, the Ministry of MSMEs has prepared a budget of around IDR 300 trillion to facilitate financing for micro-enterprise operators through the Kredit Usaha Rakyat (KUR) scheme. The Kumitra programme is linked to the provision of this budget. KUR is a government-subsidised financing programme for MSME operators aimed at providing easy access to capital with low interest rates for viable businesses, channelled through government-appointed banks and financial institutions.