Perbanas Launches UMKM Centre to Upgrade Micro and Small Enterprises

The Indonesian National Banks Association (Perbanas) has launched an UMKM Centre to help micro, small, and medium enterprises (MSMEs) upgrade across various lines.

“Strengthening the MSME sector is one of the strategic focuses we see. Therefore, we are launching the Perbanas UMKM Centre,” said Perbanas Chairman Hery Gunardi in Jakarta on Thursday.

According to him, MSMEs in Indonesia contribute more than 60 percent to the national economy and absorb the majority of the workforce. However, Perbanas research indicates a slowdown in MSME credit growth.

Hery noted that MSME credit growth had even experienced contraction at one point, prompting Perbanas to investigate the causes of the deceleration.

He added that this situation needs to be addressed by Perbanas by continuing to encourage MSME players to access financing or credit from banks to grow their businesses.

“We found that the common challenge today is not the limited supply of credit from banks. On the contrary, the majority of MSME players have not applied for credit because they feel they do not yet need financing and still rely on their own capital,” he said.

Hery added that when MSMEs do apply for credit, the approval rate is also high. This fact shows that the major agenda to be jointly pursued is increasing the bankability and readiness of MSMEs to grow and develop.

On that basis, Hery continued, Perbanas established the UMKM Centre as a collaborative platform to help MSMEs upgrade through strengthening business capacity, improving access to financing, expanding market access, and accelerating business digitalisation.

“We hope the UMKM Centre can become a bridge connecting MSME players with the ecosystem they need to develop sustainably,” he said.