Small businesses turn to loan sharks

BEKASI: About 60 percent of small-scale businesspeople in Bekasi are trapped by loan sharks, an activist said on Wednesday.

Hayyidrali Muhammad of the Bekasi chapter of the New Indonesia Society told a discussion on small-scale enterprises here that recent research by his organization showed that many businessmen obtained loans from individuals as they had no access to the banks.

He gave an example of some poultry sellers in Tambun regency who would receive loans to buy fowls on the condition that they had to sell the eggs to the creditor at a low price.

"They got 100 ducks from the creditor for the price of Rp 20,000 each, and had to return the loan by selling the eggs for Rp 400 each," he said.

The market price of the duck is lower than Rp 20,000, while at the market, the price of eggs is more than Rp 400.

Hayyidrali regretted that the banks played no significant role in the efforts to develop small-scale enterprises.

The New Indonesian Society plans to establish a small-scale enterprise center to help the businessmen, he added. --Antara