Get acquainted with Micro Credit
Do you already know the type of business? What are the differences from micro businesses, small businesses and medium-sized businesses?
The difference lies in the maximum limit of annual sales obtained.
Productive economic enterprises that produce no more than Rp. 300 million per year are categorized as micro-enterprises.
More than that, up to IDR 2.5 billion, categorized into small business groups.
While economic businesses with an annual income of more than Rp 2.5 billion to Rp 50 billion are categorized as medium-sized businesses.
Microloans referred to in this article are MSME loans as stipulated in Bank Indonesia Regulation No.14 / 22 / PBI / 2012, which are given to business actors belonging to the category of micro, small business, or medium-sized businesses.
MSMEs are considered to have helped the government in maintaining market price stability by meeting community demand.
In addition to providing employment, existence has also succeeded in increasing people’s income and economic growth in Indonesia.
Although it has had a positive impact on the national economy, still have to face several challenges, one of which is limited capital.
Therefore, this regulation obliged all commercial banks to provide microcredit services.
In terms of creditors (the bank), the provision of microcredit to customers can create material benefits for the company.
In addition, through the regulation, Bank Indonesia also promised appreciation to commercial banks that provide microcredit services.
Appreciation is expressed in the form of achievement ratings published through the website and special awards according to advanced rules.
Are you in business? Which category belongs to the business or business economy?
Did you know that knowledge about how to manage personal finance and business finance is important before starting a business?
Benefits of Micro Credit
Besides creditors, in fact, micro-credit has benefits. What are the benefits? See the explanation below:
# 1 Micro Credit to Fund Business Operations
You don’t need to worry if there is a lack of funds to continue the business.
Some banks have provided microcredit in the form of Working Capital Loans for players who are running businesses.
You can use this credit to finance business operations, such as the procurement of raw materials and receivables.
There are banks that provide working capital credit services separately,
# 2 Micro Credit for Business Expansion Capital
You can also use microcredit to expand your business, such as opening new branches, renting land for production, updating technology, and others.
This credit is usually offered by banks as investment loans.
You also benefit from a two-step loan system on investment loans in several banks.
Based on Bank Indonesia Regulation No.1 / 5 / PBI / 1999, two-step loans are defined as loans received by the Government of the Republic of Indonesia from International Financial Institutions which are forwarded to Commercial Banks and Rural Banks through Bank Indonesia.
That is, the government is the guarantor of loans given by creditors from abroad to then be channeled to banks that channel credit to the public.
Product Information to Look For Before Applying for Microcredit
How? Have you been interested enough in applying for microcredit? No need to worry, now many financial institutions can be your choice.
In addition to visiting the office directly or contacting the call center, information about micro credit products can be obtained through the bank’s official website.
Joe Gargery has summarized what information you need to consider before applying for a micro loan at a bank. Here’s the explanation:
# 1 Credit Limit
Although the name of the product is the same, the credit limit offered by each bank is not necessarily the same.
While Maybank provides Working Capital Credit products with a maximum credit of only IDR 5 billion.
There are also banks that set a credit limit using a percentage, one of which is BTN with a maximum credit of 80% of the value of SPK (Decision Support Letter).
This credit limit information is not always listed on the bank’s official website so you need to confirm again by contacting the bank directly.
Make sure that the credit limit offered by the bank matches your credit needs.
# 2 Interest Rate
The bank certainly has different calculations regarding loan interest rates.
Therefore, you should first compare credit rates at various banks.
Some banks include ‘competitive interest rates’ on their official sites, including BNI and Maybank. You can try negotiating to get a lower interest rate than the bank offers.
For example, provides services to design special Working Capital Credit products that suit the needs of its customers.
Don’t forget to consider provision fees and administrative costs in calculating your expenses.
# 3 Document Completion
Broadly speaking, the document requirements that must be met by prospective micro-credit debtors are those of prospective debtor documents, business legality documents, and collateral documents (if any).
This requirement is far simpler than applying for a corporate loan at a bank.
This is one of the benefits that you get from the existence of this microcredit program.
There are also banks that require prospective borrowers to include data on business finance in applying for microcredit.
Quoted from the official BTN website, the financial data is in the form of financial statements, project RAB, and cash flow projections.
Micro Credit for More Productive
The government hopes that microcredit products and services for small businesses can increase the positive contribution of MSMEs to the nation’s economic growth.
The bank continues to support this government program by providing various micro credit products.
As a business actor, you can take advantage of this opportunity to increase business capital, and even expand your business.