Video: Regional Development Banks' Strategy to Boost Lending Amid BI Rate Hike and Rupiah Depreciation

The increase in Bank Indonesia’s benchmark interest rate amidst global geopolitical turmoil and the depreciation of the Rupiah exchange rate is a key consideration for the banking sector, including Regional Development Banks (BPD). Bank Maluku Malut President Director, Syahrisal Imbar, stated that BPDs are continuously adjusting their policy direction and business objectives to align with government and regulator policies in facing the economic challenges of 2026. When interest rates rise, BPDs have not yet increased lending rates in order to maintain regional economic growth momentum, particularly in the retail and MSME sectors. Concurrently, Bank Maluku Malut is pushing to increase low-cost funding sources through savings and current accounts. Amid cuts to regional transfer funds and government efficiency measures, BPDs are stepping in to boost the economy through financing for regional governments and MSMEs at favourable interest rates.