Government Support and Guarantee Industry Help MSMEs Grow

Jakarta – The government continues to strive to support the growth of Micro, Small, and Medium Enterprises (MSMEs) through cooperation with the banking and guarantee industries.

Deputy for Micro Enterprises at the Ministry of MSMEs, Riza Adha Damanik, said that the joint meeting with the State Bank Association (Himbara) and the National Nutrition Agency regarding capital for MSMEs in the Free Nutritious Meals (MBG) program had gone well.

“The development is very positive, so there will likely be an upfront payment scheme to support the MBG kitchen needs,” said Riza.

The upfront financing scheme was proposed as the government’s response to the needs of MSMEs in supporting the implementation of the MBG program.

Riza explained that so far, the payment mechanism in this program has used a reimbursement system, which means that MSMEs must bear operational costs first before receiving reimbursement.

According to him, the cost of shopping for the kitchen in a day can reach IDR 30 million with the assumption of providing 3,000 portions of food, each priced at IDR 10 thousand. In a week, the total cost that MSMEs must provide reaches IDR 210 million. This burden is quite heavy for business actors, especially those with limited capital.

“If it lasts for seven days, the total reaches IDR 210 million. MSMEs need to provide funds of that amount,” said Riza.

To overcome this obstacle, the government designed an upfront financing scheme that will be the initial capital for MSMEs in running their businesses. This scheme was discussed further with Himbara banks so that there is a uniform mechanism in supporting the MBG program.

“That was discussed yesterday with Himbara banks so that there is a uniform mechanism and method in supporting the free nutritious meal program, so that the ecosystem can be more easily accessed by the MSMEs involved,” said Riza.

Previously, Minister of MSMEs Maman Abdurrahman stated that his party would prepare a special scheme to facilitate access to capital for MSME actors in the MBG program.

He emphasized that there are 46 banks distributing People’s Business Credit (KUR) under the coordination of the Ministry of MSMEs, including four banks that are part of Himbara.

The four Himbara banks will play a role in the financing scheme for MSMEs involved in MBG. With the support of capital access that is being built by the Ministry of MSMEs, the National Nutrition Agency, and Himbara, Maman hopes that the financial burden of MSMEs can be reduced so that they can focus on running their businesses more optimally.