Regulation on the Handling of Non-Performing Loans of Village Funds in Cooperatives

The government is currently drafting Regulation of the Minister regarding violations in the use of village funds within village cooperatives. The objective is to ensure that the utilization of these funds is more effective, transparent, and accountable.

“There are several proposals in the draft, including the types of violations, methods for addressing violations, and the handling of non-performing loans,” said Yandri Susanto, the Minister of Villages, Development of Disadvantaged Regions and Transmigration.

In the draft regulation, there will be a specific scheme to address non-performing loans in programs utilizing village funds. This regulation is also expected to align with the village economic empowerment programs.

Yandri stated that the draft has been submitted to the Ministry of Law for the harmonization process. It is hoped that this regulation will serve as a guideline for village governments and communities to manage the funds optimally, including encouraging village cooperatives to operate more professionally and avoid legal disputes.