NEXT: Bank lending shifts towards productive sectors
Jakarta (ANTARA) - Research institute NEXT Indonesia Center has stated that the direction of national bank lending is beginning to shift towards productive sectors, after credit expansion was previously largely supported by consumer financing. NEXT Indonesia Center Executive Director Christiantoko said this change in lending direction shows the banking industry is being selective towards sectors with better growth prospects and manageable risk. “This is a positive signal. Currently, banks are not only looking at the size of financing needs but also considering business prospects, risk quality, and the sector’s potential to drive economic growth. This shift indicates that the banking intermediation function is starting to flow more into sectors that create added value,” Christiantoko said in a statement in Jakarta on Sunday.
The NEXT Indonesia Center’s latest report, titled “Sektor Usaha Favorit Perbankan” (Banks’ Favourite Business Sectors), shows that outstanding loans from commercial banks have continued to increase over the past three years. As of April 2026, total commercial bank loans reached Rp8,755 trillion, with loans to economic sectors amounting to Rp6,454 trillion and non-sector loans, such as household consumption, reaching Rp2,301 trillion. The most striking change is seen in the composition of loan usage. Throughout the 2024-2026 period, investment credit became the main growth driver. As of April 2026, investment credit grew by 19.48 percent year-on-year (yoy), far outpacing the growth of working capital credit at 6.04 percent yoy and consumer credit at 6.13 percent yoy. “This condition shows that more financing is being directed towards productive asset development, business expansion, and long-term investment,” he said.
Based on NEXT Indonesia Center’s analysis, five business sectors are currently the main targets of bank credit expansion: construction, electricity and gas supply, professional and corporate activities, real estate, and human health and social work activities. According to Christiantoko, the dominance of investment credit is an important indicator that the business world is starting to expand again. “Investment credit usually reflects business actors’ optimism about business prospects in the coming years. When this type of credit grows the fastest, it means there is confidence that economic activity still has room to grow,” he said.
Overall, bank credit quality remains well maintained. This is reflected in the gross non-performing loan (NPL) ratio, which stood at 2.17 percent as of April 2026. However, when viewed by type of loan usage, the risk profile begins to show differences. Investment credit is the segment with the best credit quality, with an NPL of 1.34 percent as of April 2026. Conversely, working capital credit remains the segment with the highest risk, with an NPL reaching 2.64 percent in the same period.