MICROCAPITAL BRIEF: Indonesian Government Seeks to Shift KUR Microlending to Agriculture, Fisheries, Manufacturing from Trading, Services

The Indonesian government recently announced it plans to grow the portion of its Kredit Usaha Rakyat (KUR) program that is used for agriculture, fishing and manufacturing from 22 percent of the program total to 40 percent. The remainder of KUR lending is for trading and services.

During 2016, partner banks disbursed loans totaling IDR 94 trillion (USD 7.1 billion) via the program to micro-, small and medium-sized enterprises (MSMEs) and cooperatives. The government plans to boost this total to IDR 110 trillion (USD 8.2 billion) during 2017. KUR, which was founded in 2007, offers end-borrowers annual interest rates of 9 percent. The loans are guaranteed by the government.

By Phoebe Rorke, Research Associate

Sources and Additional Resources

The Jakarta Globe:
Govt to Offer More Micro Loans for Agriculture, Fishery, Manufacturing Sectors

KUR:
Kredit Usaha Rakyat

MicroCapital:
Indonesia to Disburse $2.2b under Microfinance Program Kredit Usaha Rakyat (KUR) to Encourage Growth of Micro-, Small and Medium-sized Enterprises (MSMEs)

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