Kadin-sponsored guarantee fund set to operate
Kadin-sponsored guarantee fund set to operate
JAKARTA (JP): Guarantee-fund firm PT Penjamin Kredit Pengusaha
Indonesia is ready to guarantee credits extended to small and
medium enterprises this year.
The company's president, Mahmud Jakile, said recently that the
fund got its operating license from the government only last
August -- 10 months after its launch.
"Only after we got the license, could we look for prospective
clients. Nevertheless, we have listed some small and medium
companies as our prospective clients," Jakile said.
They include West Sumatra handicraft firms grouped in a
cooperative, small firms affiliated to a state plantation firm in
South Sulawesi, two small firms in Irian Jaya and others in the
greater Jakarta area.
Jakile said earlier the fund would guarantee bank loans to
small businesses of between Rp 50 million (US$20,990) and Rp 250
million.
It does not guarantee loans below Rp 50 million because state-
owned banks have been encouraged to extend collateral-free loans
of up to Rp 50 million to small enterprises.
"As a profit-oriented firm, we need to select only businesses
with good prospects. If possible, we will prepare them to go
public by selling shares on the capital market," Jakile said.
The fund's sources of revenues will include interest earned on
bank deposits as well as commission fees, arrangement fees and
consultation fees from its client companies. Funding will also
come from banks using its service to select small companies as
customers.
The guarantee fund was established with an initial paid-up
capital of Rp 6.16 billion (around US$2.6 million) in October,
1995, by the Indonesian Chamber of Commerce and Industry in
cooperation with the ruling Golkar party.
The chamber's chairman Aburizal Bakrie said last week the
guarantee fund had collected Rp 12 billion from local tycoons as
its capital -- far short of its original target of Rp 50 billion.
At the launching of the fund last Oct. 31 noted figures and
big businesses participated in its establishment. Minister of
Cooperatives and Small Enterprises Subiakto Tjakrawerdaya, PT
Bakrie Investindo, and business tycoons Eka Tjipta Widjaja and
Sudwikatmono helped strengthen the fund's capital by contributing
Rp 1 billion each.
Aburizal said the establishment of the guarantee fund was
expected to help spur the development of small enterprises so
that they could grow into medium and then large businesses.
"As we all understand the main weaknesses of small businesses
are that they lack capitals and managerial skills and that they
are not bankable. Therefore this guarantee fund is expected to
help small businesses secure bank credit to groom their
businesses," Aburizal said.
He added the guarantee fund was to complement the government-
sponsored venture capital programs that had invested in small
enterprises through equity participation. (rid)