OJK Adjusts Bank Business Plan Regulation to Promote Credit for Government Priority Programmes

Jakarta (ANTARA) - The Financial Services Authority (OJK) is adjusting its OJK Regulation (POJK) on Bank Business Plans (RBB) to encourage banks to participate more actively in channelling credit to government priority programmes.

“We are drafting an RPOJK to adjust the RBB provisions. Within it, we are supporting banks to engage more with government priority programmes such as MBG, 3 Million Houses, Kopdes, and others; we are preparing those in the RPOJK RBB provisions,” said OJK Board Chair Friderica Widyasari Dewi at the Indonesia Outlook event in Jakarta on Tuesday.

When asked by reporters about the Draft POJK (RPOJK), Friderica, or Kiki as she is fondly known, explained that financing for priority programmes is not mandatory, but the regulator is encouraging it.

“It is not mandatory, but we encourage it. Everything must align with their (banks’) risk management and risk appetite,” she said.

“For SMEs, for example, we must encourage it; there must be a bias towards SMEs. Otherwise, the figures will stay the same,” she added.

She further noted that support for SMEs requires a comprehensive strategy. In this regard, it is not just about facilitating access to financing, but also maintaining credit quality.

“That is a national strategy, for example, how our SMEs can be upgraded and so on; it will be an extraordinary collaboration from all parties, both from the financial sector and the government such as through the Ministry of SMEs, and it will continue to progress,” said Kiki.

The adjustments include detailing fund placement plans. In Article 12 of POJK 5/2016, these plans must at least cover plans for providing funds to related parties; plans for granting credit or financing to core debtors; credit plans based on specific business activities.

Then, credit plans based on business fields, types of usage, provinces, and types of contracts; credit plans to SMEs; plans for fund placements in securities; and other fund placement plans.

In the draft RPOJK on RBB, in addition to retaining the credit plan details as regulated in POJK 5/2016, there are additions to the scope of fund placement details, including plans for channelling People’s Business Credit (KUR) as well as other credit provision plans, including credit under government programmes.