UMKM Credit Projected to Grow Up to 9 Per Cent by 2026, Here are the Factors
Jakarta – The Financial Services Authority (OJK) has projected that credit disbursement to the Micro, Small, and Medium Enterprises (UMKM) sector will grow in the range of 7–9 per cent annually in 2026. This projection aligns with increasing consumer confidence, prospects for national economic growth, and the strengthening of UMKM financing policies being continuously promoted by the OJK alongside the government.
Dian Ediana Rae, Head of Banking Supervision at the OJK, stated that expanding access to financing for UMKM is one of the authority’s primary focuses. This effort is considered vital for maintaining the stability of the financial system whilst driving sustainable economic growth.
“The OJK continues to coordinate with the banking industry regarding the implementation of UMKM regulations in bank business plans,” said Dian, as reported on Tuesday, 10 March 2026.
According to OJK data, UMKM credit disbursement as of January 2026 reached Rp1.482.9 trillion, representing approximately 17.33 per cent of total credit disbursement or financing in the banking sector. However, UMKM credit growth experienced moderation of 0.53 per cent year-on-year.
Dian explained that this slowdown was influenced by several factors, including dynamics in global and national economic conditions, as well as the relatively slower recovery of the UMKM sector following the pandemic compared to the corporate sector.
Despite facing short-term challenges, the banking industry remains optimistic about UMKM credit growth prospects throughout 2026. This optimism is supported by increasing consumer confidence in economic conditions.
The OJK noted that the Consumer Confidence Index (IKK) at the beginning of 2026 stood at a positive level of 127.00 per cent, whilst the Consumer Price Index was recorded at 109.75 per cent. Both indicators show an upward trend over the past year and reflect public optimism regarding current economic conditions and future prospects.
Additionally, the momentum of public consumption approaching the Eid al-Fitr holiday is expected to drive economic activity in the early part of the year. The seasonal effect of Ramadan and Eid celebrations is anticipated to increase household consumption in the first quarter of 2026, which in turn could increase demand for working capital credit in the UMKM sector.
As part of efforts to strengthen access to financing for small business operators, the OJK issued OJK Regulation (POJK) Number 19 of 2025 on Ease of Access to Financing for UMKM. This regulation requires banks and non-bank financial institutions to implement financing principles that are easy, appropriate, fast, affordable, and inclusive, as well as to provide financing schemes specifically designed for the UMKM sector.