BRI Microfinance Outlook Spurs Positive Growth in Indonesian Microfinance and SME Sectors

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Apr 29, 2021, 23:00 ET

JAKARTA, Indonesia, April 29, 2021 /PRNewswire/ -- Supported by Indonesia's largest MSMEs bank, Bank BRI (IDX: BBRI), BRI Research Institute announces its commitment to support microfinance institutions at the BRI Microfinance Outlook 2021 event on April 28, 2021. Entitled "Adapting Through Innovation & Synergy," the event was attended by Minister of Cooperatives and Small and Medium Enterprises, Teten Masduki; Chairman of the Board of Commissioners of the Financial Services Authority (OJK), Wimboh Santoso; State-Owned Enterprises (SOE) Deputy Ministers, Pahala N. Mansury and Kartika Wirjoatmodjo; as well as BRI President Director, Sunarso.

(Left to Right) President Director Bank BRI, Sunarso & Minister of Cooperatives and Small and Medium Enterprises, Teten Masduki

With the BRI Microfinance Outlook 2021, BRI aims to succeed the growth of micro, small, and medium enterprises (MSME) amid economic uncertainty. BRI's support for MSMEs will remain high, especially as the MSMEs' role has caused a significant impact on the national economy.

According to a data by the Ministry of Cooperatives and Small and Medium Enterprises, in 2018, there was a total of around 62 million micro-entrepreneurs in Indonesia. The figure includes 757,000 small businesses, 58,600 medium enterprises, and 5,500 corporations. Therefore, MSMEs' contribution to Indonesian gross domestic product (GDP) has reached over 62 percent, or equivalent to IDR 8,000 trillion.

"With the close relations and collaborations with stakeholders at the regional, national, and global level, this year, BRI aims to advance the microfinance sector and empower Indonesian MSMEs in a synergistic ecosystem. We are looking for abundant support and collaboration to enrich our insights for the MSMEs' continued development. Hence, we will not stay in a stagnant situation yet be able to develop and find new sources of growth from the levels below," said Sunarso.

On the same occasion, Pahala N. Mansury revealed that the Indonesia's economic will continue to improve in the second quarter of 2021. "This can be seen from the increased demand of household electricity supply in Indonesia, which needs to be maintained and utilized as possible," said Pahala.

Pahala added that in 2021, the SOE Ministry will focus on providing support for fulfilling infrastructure needs, funding, and market access for the MSMEs' development and recovery. The support will be undertaken through policies and corporate actions, as well as integration between existing state-owned enterprises (SOEs) to make them more efficient for the advancement of MSMEs.

"We are trying to build digital platforms and digital services for MSMEs. In terms of funding or financing, one of our Ultra Micro (UMi)-related initiatives includes consolidating SOEs to support the ultra-micro ecosystem. Indeed, the number of ultra-micro businesses currently still require funds. We hope that the consolidation of SOEs can support the UMi ecosystem, while empowering and increasing our capabilities. We also aim to widen our financial products to saving and insurance. With this strategy, anytime ultra-micro businesses aim to move up to the next step, we can achieve that," added Pahala.

Wimboh Santoso affirmed that stakeholders must implement new approach for MSMEs as financing is not enough. "They need guidance, sales channels, and a complete ecosystem to ensure more quality and productivity of MSMEs," he said.

Government support is also crucial to strive the success of MSMEs. Teten Masduki added, "Currently, the government is trying to create new entrepreneurs, both existing and pioneering. We set the target of around 4% in 2024. With a support of a financing ecosystem, an entrepreneurial ecosystem, and focusing on MSMEs that accompany them, including those in incubation, we are optimistic to achieve it," said Teten.

Through BRI Microfinance Outlook 2021, BRI has led its role in MSMEs.

During the event, Teten also prided BRI as the champion of MSMEs. "The event is indeed really good. It is not surprising that BRI receives a lot of international praises as a prominent bank.

The event, which was held in a hybrid webinar format, presented a total of two sessions with the sub-themes of Empowering Sustainable Microfinance & Its Ecosystem, and Boosting Innovation for Synergy in Microfinance. Presenting in the first session were BRI Micro-Business Director, Supari; Harvard Kennedy School adjunct lecturer, Jay Rosengard; University of Indonesia sociologist, Imam Prasojo; McKinsey and Company representative, Prateek Bhargava; and OJK senior executive analyst, Roberto Akyuwen.

Meanwhile, the second session was delivered by the University of Indonesia chancellor, Prof. Ari Kuncoro; Cornell University representative, Prof. Iwan Jaya Azis; Kulon Progo Regent, H. Sutedjo; Secretary General of the Indonesian Fintech Lending Association and CEO of Dompet, Sunu Widyatmoko; and Chief Economist of BRI and Director of the BRI Research Institute, Dr. Anton Hendranata.

In addition to the webinar sessions, the BRI Microfinance Outlook 2021 also presented the BRI Micro & SME Index (BMSI) Q1-2021. The event also unveiled LinkUMKM, a digital empowerment platform developed by BRI Bank for Indonesian MSMEs, as well as the Professional Certification Institute (LSP). It is hoped that the emergence of these new products and institutions can increase the capacity of all policymakers to optimally empower MSMEs and create more scale-up business actors.

For more information, visit www.bri.co.id

SOURCE PT Bank Rakyat Indonesia Tbk (BRI)