Small businesses turn to loan sharks

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