OJK Regulates Collaboration Between Banks-LKNB and LPBBTI for UMKM Financing

The Financial Services Authority (“ OJK ”) is soon finalizing a Draft OJK Regulation  (Rancangan Peraturan Otoritas Jasa Keuangan– “ RPOJK ”) regarding financing access for Micro-, Small-, and Medium Scales Enterprises (Usaha Mikro Kecil dan Menengah– “ UMKM ”). This regulation allows banks and Non-Bank Financial Institutions (Bank dan Lembaga Keuangan Nonbank– “ LKNB ”) to collaborate in providing easier access to financing through executing and channeling schemes tailored to the business characteristics or business cycles of UMKM.

“Collaboration between banks and fintech companies represents a business opportunity that contributes to the intermediation function, particularly in reaching the UMKM segment,” stated Dian Ediana Rae, Executive Director of Banking Supervision at OJK, in an interview with Hukumonline.

According to documents held by Hukumonline, the Supply Chain Financing scheme enables financing across the entire ecosystem of the agricultural, plantation, livestock, manufacturing, and/or trade sectors, from upstream to downstream (off-takers or buyers of UMKM products).

Meanwhile, the channeling mechanism is implemented through financing provided to specific community groups, such as groups of women rattan craftpeople in a particular region, aimed at enhancing UMKM empowerment.

This synergy is expected to improve financial access and services for the public in order to support the deepening and expansion of financial inclusion. Notably, as of April 2025, the portion of financing from Technology-Based Joint Funding Services (Layanan Pendanaan Bersama Berbasis Teknologi Informasi/LPBBTI) or Pindar in the productive sector and/or UMKM has reached 35.38%, amounting to Rp28.63 trillion.