TEMPO.CO, Jakarta - Bank Indonesia (BI) has highlighted the concerning slowdown in the growth of Micro, Small, and Medium Enterprises (MSME) credit. Sri Noerhidajati, Deputy Director of BI's Department of Inclusive and Green Financial Economics, revealed that SME credit growth in March 2025 was a mere 1.95 percent, significantly lower than the growth experienced during the COVID-19 pandemic.
"Indeed, it's quite disheartening; SME credit in March 2025 only grew by 1.95 percent. In contrast, during the pandemic, it reached approximately 10 percent," she stated during the press conference kick-off of SisBerdaya and DisBeraya 2025 at the Shangri-La Hotel, Jakarta, on Wednesday, May 7, 2025.
She also questioned the reasons behind this decline in SME credit growth. Sri noted that BI is actively seeking ways to stimulate SME credit growth. "We are continuously looking for ways to increase it. Is it that they really don't need credit, or what is the issue? Or is it indeed as suggested, that the macro conditions are unfavorable, public purchasing power is decreasing, leading to a lack of demand for SMEs?" Sri pondered.
On the other hand, Sri acknowledged that some SMEs do not require banking credit, citing examples of businesses receiving capital support from friends, family, or supporting programs.
"One garment company in Bandung, for instance, doesn't need capital because this SME is performing so well that it even receives funding from friends and, if I'm not mistaken, from Blibli (e-commerce platform). So, they no longer require banking financing," Sri explained.
She further stated that BI is committed to supporting the empowerment of SMEs, particularly women-led SMEs, through various policies, strategies, and pro-SME and pro-innovation infrastructure support. According to her, BI is actively promoting the creation of a healthy and inclusive business environment to enable Indonesian SMEs to become the driving force of the national economy.
Furthermore, Sri mentioned that BI is also incentivizing SME financing through measures such as macroprudential incentive payment ratios. These incentives are provided to banks to encourage greater attention to and provision of credit to SMEs. The incentive mechanism involves the reduction of their minimum mandatory reserves.
"Therefore, it is hoped that this policy will serve as an incentive for banks to willingly distribute credit to SMEs," she concluded.
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