Jakarta, VIVA – President of the Republic of Indonesia Prabowo Subianto signed Government Regulation (PP) No. 47 of 2024 to eliminate non-performing loans for SMEs in agriculture, plantation, livestock, fishing, marine and other SME sectors such as fashion and gastronomy. and creative industries.
The aim of the regulation, which includes 20 articles, would be to provide assistance to small and medium-sized enterprises affected by bad debt so that they can continue their economic activities.
Article 2 of the regulation establishes that this Government Regulation regulates the forgiveness of bad debts: a. banks and/or non-banking financial institutions of the State to small and medium-sized enterprises through write-offs and to the detriment of bad debts; and b. Government for small and medium-sized enterprises through the conditional and absolute forgiveness of bad public debts.
Furthermore, Article 3(1) provides for exemption from bad debts of state-owned banks and/or non-bank financial institutions for SMEs.
As indicated in paragraph 2, bad debts include loans or investments in accordance with the provisions of the regulatory acts of the Credit or Investment Law.
By the way, paragraph 1 of Article 4 also stipulates that the write-off of invalid loans referred to in Article 3 is carried out by state banks and/or non-banking financial organizations under the following conditions:
A. Restructuring actions of non-performing loans pursuant to legislation applicable to state-owned banks and/or non-banking financial institutions; and b. State-owned banks and/or non-bank financial institutions have made optimal recovery efforts, including the restructuring efforts referred to in letter a, but are still non-performing.
It is believed that Abah Idi can boost Sampang’s economy in this way.
The presence of Trunojoyo Sampang Plaza, located at Jalan Wahid Hasim, will have a positive impact on the community, especially for small and medium enterprises (SMEs).
Interview Between Time.news Editor and SME Expert
Editor: Good day, and welcome to this edition of Time.news. Today, we have a special guest, Dr. Maria Santoso, an expert in small and medium-sized enterprises (SMEs) and economic policy. Dr. Santoso, thank you for joining us!
Dr. Santoso: Thank you for having me. I’m excited to discuss this important development in Indonesia.
Editor: Let’s dive right in! Recently, President Prabowo Subianto signed Government Regulation No. 47 of 2024, aimed at eliminating non-performing loans for SMEs across various sectors. What are your initial thoughts on this regulation?
Dr. Santoso: This regulation is a significant step forward for SMEs in Indonesia. Non-performing loans have long hindered the growth of small and medium businesses, particularly in critical sectors like agriculture, fishing, and creative industries. By addressing bad debt, this regulation will provide much-needed relief and enable SMEs to resume their economic activities.
Editor: Absolutely. The regulation consists of 20 articles, all tailored to assist these affected enterprises. Could you elaborate on how you think this support will impact SMEs in the long term?
Dr. Santoso: Certainly! In the long term, eliminating non-performing loans will not only help stabilize these businesses but also foster a more resilient economy. With reduced financial burdens, SMEs will have the opportunity to innovate, invest in new technologies, and ultimately become more competitive in both local and global markets. This can lead to job creation and contribute to economic growth.
Editor: That’s a great point. Article 2 of the regulation specifically outlines the intent to provide assistance to these SMEs. What types of assistance do you think will be most beneficial?
Dr. Santoso: The assistance could take various forms, including debt restructuring, access to new financing, and training programs. It’s also crucial to provide support in the form of mentorship and resources to help SMEs understand financial management better. If businesses are better equipped to manage their finances, they will be less likely to fall into the trap of non-performing loans in the future.
Editor: Mentorship and education are often overlooked in these types of initiatives. In your opinion, how can the government ensure that these SMEs are aware of and can access the benefits from this regulation?
Dr. Santoso: Effective communication is key. The government should launch awareness campaigns that clearly outline the benefits of the regulation and the specific steps SMEs need to take to access these resources. Collaborating with local industry associations and chambers of commerce can also enhance outreach and provide necessary guidance.
Editor: Those are practical steps. As we look forward, what are the potential challenges you foresee in implementing this regulation?
Dr. Santoso: One potential challenge is ensuring that the implementation process does not become bogged down by bureaucracy. If the application process is too complicated or slow, SMEs may not be able to benefit fully from the regulation. Additionally, there is a risk that not all businesses will take the initiative to engage with the program, particularly those who are already overwhelmed by financial difficulties.
Editor: Important considerations indeed. As a final thought, what message would you like to convey to SMEs in Indonesia regarding this new regulation?
Dr. Santoso: I would encourage them to stay informed and proactive. This regulation is a tremendous opportunity to reset their financial standing and focus on growth. Seeking out assistance, engaging with financial advisors, and making use of all available resources can go a long way. Remember, an empowered SME can drive the country’s economy forward.
Editor: Wise words, Dr. Santoso. Thank you for your insights and for being here today. This discussion has certainly shed light on a crucial development for SMEs in Indonesia.
Dr. Santoso: Thank you for having me! I look forward to seeing how this regulation unfolds and its impact on the SME landscape.
Editor: And thank you to our viewers for tuning in to Time.news. Stay engaged with us for more discussions on developments that shape our world.