Bank Indonesia tells banks to provide financing to SMEs
As much as 30% of banks’ loan books will need to be directed to small businesses
Bank Indonesia (BI) has told banks to provide at least 20% of their total financing to small businesses by next June, as part of a new policy of channelling funding to the vulnerable sector.
Banks will have to increase the financing to micro, small and medium enterprises (MSMEs) to 25% of their portfolios by June of 2023, and 30% by June of 2024, according to a notice published by BI on September 1.
The measure, dubbed the Macro-prudential Inclusive Financing Ratio (RPIM) ratio, recognises
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