Prabowo Outraged by 24% Microcredit Interest Rates While Large Businesses Receive 9%
President Prabowo Subianto has expressed outrage regarding the inequality in access to financing for small communities and micro-entrepreneurs. He criticised the interest rates for the ‘Membina Ekonomi Keluarga Sejahtera’ (Mekaar) programme, managed by Permodalan Nasional Madani (PNM), which are estimated to be as high as 22% to 24%.
Consequently, Prabowo has ordered that interest rates for these micro-entrepreneurs must be reduced to below 10%. He stated that this directive will be implemented by the Minister of Finance and Danantara.
“The rates were originally 24%, 22%; I have ordered them to drop below 10%. Ultimately, the Minister of Finance and Danantara [responded], ‘It is already 8%, Sir.’ Eight percent. Where is Danantara? Anyway, it must be below [the threshold],” he said, as reported on Monday.
Prabode expressed that he cannot accept a situation where large entrepreneurs can access credit at rates of up to 9%, while housewives in rural villages are charged 24%.
“That is not right. We will change it!” he asserted.
He ensured that the government will provide credit with relatively low interest rates. Previously, Prabowo had also condemned the high interest rates charged by PNM.
He expressed shock upon discovering that PNM Mekaar debtors, with loan amounts ranging from Rp 2 million to Rp 10 million, are subject to interest rates of up to 24%, whereas the rate should be below 10%. These PNM Mekaar loans are widely utilised by micro-businesses.
He deemed this treatment unfair, noting that large entrepreneurs can borrow from banks at 10% interest. Therefore, he convened ministers and assigned specific tasks to the Minister of Finance and the CEO of Danantara.
“How much, Mr Rosan, 9%? Many wealthy people are given 9%, while the poor are given 24%. Is this not a Pancasila state? I do not understand. I gathered the ministers. I have instructed the Minister of Finance and Danantara; this is a political decision. I have decided that for the capitalisation of the ‘Masyarakat Madani’ and prosperous family credits, we must reduce it from 24% to below 10%, specifically below 9%,” Prabowo stated firmly.
“It must be below 9%. Can Danantara do this?” Prabowo asked Rosan, who was present at the ceremony.
The CEO of Danantara agreed to an 8% rate. Prabowo responded by asking, “What percentage? 8%? You deliberately chose 8%; why not 7%? Fine, the point is it must be below 9%.”
Prabowo stated he cannot accept the underprivileged paying higher interest rates than the wealthy. He does not wish to see such unfair practices, which he believes are inconsistent with the 1945 Constitution and the values of Pancasila.