Professional Documents
Culture Documents
OUTLINE
I
BACKGROUND
II
III
IV
V
MSME CHALLENGES
REGULATION TO ACCELERATE MSME FINANCING
BI INITIATIVES TO PROMOTE MSME FINANCING
I. BACKGROUND
A. THE ROLE OF MSMES
The strong resilience of the Indonesia economy among other is due to the
strong domestic demand, which is supported by the pivotal role of MSME
99.9% of 55
million business
units
absorb around
97,2% of total
labor force.
contribution
around 57,48%
to the GDP
contribution
around 14.06%
to export (non
oil and gas)
B. FINANCING STRUCTURE
Indonesia has a huge economic potential and large market for financial services.
Pawn Broker
0.5%
Insurance
Companies
9.9%
Commercial
Banks
78.8%
1) 2013, BPS
2) World Bank
3) BPS
Credit
Guarantee
Company
0.1%
Venture
Capital
0.1%
4,954.47
Insurance Companies
623.59
Multifinance Companies
420.03
Pension Funds
162.48
Rural Banks
77.24
Pawn Broker
30.77
Venture Capital
8.70
7.87
B. WEAKNESS OF MSME
Wage of
Labour
1%
Skill
1%
Transportation
3%
Fuel/Energy
4%
Materials
11%
Others
10%
Financing
35%
Marketing
35%
Financing and Marketing aspects are the main challenges of the MSME
Source : National Economic Census 2006
Small
Medium
IDR50-million
(USD4,167)
IDR500-million
(USD41,667)
IDR10-billion
(USD833,833)
Annual IDR300-million
Sales
(USD25,000)
IDR2,5-billion
(USD208,333)
IDR50-billion
(USD4,2 million)
Assets
Bank
Indonesia
provides Technical
Assistance
to
increase capacities
of FI and MSME in
the
form
of
research, training,
provision
of
information,
and
facilitation.
10
CSR
(PNPM,
PKBL,
PUAP)
Not feasible
Productive poor,
Micro and Small
Enterprises
Subsidized
Credit
Program
- KKPE
- KPENRP
- KUPS
Feasible, not
bankable
Micro and Small
Enterprises
Feasible,
Bankable
Micro, Small and
Medium Enterprises
MSME Financing
Guaranteed
Credit
Program
KUR
Commercial
Credit
Credit
PKBL : Program Kemitraan Bina Lingkungan (Partnership and Community Development Program)
PUAP : Pengembangan Usaha Agribisnis Perdesaan (Rural Agribusiness Development)
PNPM : Program Nasional Pemberdayaan Masyarakat (National Program for Community Empowerment)
11
Program
Methods
Increasing Access
to Finance
Minimize the
Asymmetric
Information
Coordination &
Strategic
Partnership
Cluster (Value
Chain)
Development
Entrepreneurship
Development
Financial transaction
recording movement
Strengthening Financial
Infrastructure
Facilitation of
Government Credit
Program (KUR, KKPE,
KUPS)
Provision of
study/research
Dissemination of
Information
Development of
MSME Microsite in
the website of
Bank Indonesia
Coordination with
local
government,
central
government and
international
institutions
Training
Provision of
Information
Facilitation
Research
12
Entrepreneurship
Development
To create new
entrepreneur by
providing technical
assistance and
business coaching
13
The Utilization of
Land Certificate
To overcome
asymmetric
information
between SME and
banks.
To encourage the
use of land
certificates to
improve access to
finance for MSME.
Pilot Project as a
cooperation
between Bank
Indonesia, OJK,
banks and rating
agencies.
Joint cooperation
among related
Ministries,
National Land
Agency, and Bank
Indonesia.
Cattle Insurance
To address the risks
inherent in the
cattle farm
business.
Joint cooperation
among Bank
Indonesia,
Ministries of
Agriculture and
insurance
companies.
14
Strategies :
a) Innovation, such as financial transaction recording through ICT devices (personal
computers, laptops and smart phones)
b) Widening financing sources (Value Chain Financing, Angel Investors)
15