JakartaPost-Jan 31, 2025

Coordinating Economic Affairs Minister Airlangga Hartarto has launched a national credit scheme with an estimated volume of Rp 20 trillion (US$1.23 billion) this year to help labor-intensive industries increase productivity, revitalize machines and maximize exports. Producers of textiles, furniture, leather products and toys are among the businesses eligible for the new credit scheme. Speaking on Thursday at the BRI Microfinance Outlook 2025 in Jakarta, Airlangga said the scheme involved any “bank providing credit to micro, small and medium enterprises [MSMEs]” in labor-intensive industries. “The interest will be subsidized 5 percent,” he told the event, as quoted by Kontan.co.id. The Financial Services Authority (OJK) welcomed the scheme, saying it would contribute to the growth of labor-intensive industries as well as prevent layoffs. The scheme offers loans of between Rp 500 million and Rp 10 billion at rates below the typical interest on commercial credit and flexible loan terms of five to eight years. To obtain loans under the new scheme, borrowers must meet several conditions, including at least two years of business experience and no fewer than 50 employees. MSMEs play a vital role in the economy, contributing around 60 percent to Indonesia’s GDP and employing 97 percent of the national workforce. However, experts have pointed to a lack of investment in the sector in recent years.  Read more at:

https://www.thejakartapost.com/business/2025/01/31/indonesia-launches-new-credit-scheme-for-labor-intensive-industries.html.