OJK Will Soon Issue Regulation on MSME Financing

The Financial Services Authority (Otoritas Jasa Keuangan– “ OJK ”) will soon issue regulations regarding Access to Financing for Micro, Small, and Medium Enterprises (Usaha Mikro, Kecil, dan Menengah– “ UMKM ”) in the near future. The Chief Executive of Banking Supervision at OJK, Dian Ediana Rae, explained that this policy aligns with the government’s program, particularly related to the elimination of non-performing credits for UMKM.

“As a form of support for UMKM credit improvement program, we have finalized the Regulation OJK (“ POJK ”) to make it easier for UMKM to gain access to financing,” said Dian to Hukumonline.

It is expected that this POJK will encourage the distribution of credit to UMKM debtors with good business prospects for expansion. Moreover, banks remain optimistic about UMKM credit growth, which is projected to grow positive until the end of 2025.

“This policy has the potential to increase the portion of UMKM financing, which is still around 20% of the total banking financing portfolio,” he explained.