Kadin's guarantee fund to operate soon

Kadin's guarantee fund to operate soon

JAKARTA (JP): Indonesian Chamber of Commerce and Industry
Chairman Aburizal Bakrie said yesterday that the chamber's credit
guarantee fund, which is intended to spur the growth of smaller
businesses, is likely to commence operations next month.

"This guarantee fund is one of the alternatives in helping to
solve the problems faced by small enterprises, since they mostly
do not have enough collateral to get bank loans," Aburizal said
in Banjarmasin, South Kalimantan.

He said the fund would guarantee bank loans to small
businesses of between Rp 50 million (US$22,000) and Rp 250
million.

The government announced recently that it will soon allow
state banks to extend collateral-free loans of up to Rp 50
million to small enterprises.

The guarantee fund, a kind of credit insurance firm, was
jointly established by the chamber of commerce and the ruling
Golkar party last May, with an initial paid-up capital of Rp 50
billion.

Aburizal said that, if necessary, a number of big businesses
are willing to contribute to the fund.

"The creation of this fund shows that big enterprises really
want to nurture the growth of small and medium-sized businesses,"
Aburizal said.

He said that the fund would operate as a limited liability
company and would be "profit-oriented." (rid)