Akumindo supports capital aid distribution for economic recovery

Akumindo supports capital aid distribution for economic recovery

Illustration - MSME traders make typical Betawi food with egg crust in the Setu Babakan Tourist Area, Jakarta, Saturday (8/8/2020). Antara Foto / Asprilla Dwi Adha

The point is that the distribution must be fast. The faster (the distribution), the sooner the economy can return to positive growth in the third quarter
Jakarta (ANTARA) - The Association of Indonesian MSMEs (Akumindo) has backed the accelerated distribution of working capital assistance for micro, small, and medium enterprises (MSMEs) to contribute to actively encouraging national economic recovery.

"The point is that the distribution must be fast. The faster (the distribution), the sooner the economy can return to positive growth in the third quarter," Akumindo Chairman Muhammad Ikhsan Ingratubun stated here on Tuesday.

Ingratubun said the association welcomed programs that are part of the National Economic Recovery (PEN) Program, including one, which also offers stimulus assistance for MSME players, so that they can survive amid the COVID-19 pandemic.

The Akumindo chairman noted that MSME players had utilized stimulus assistance in the form of relaxation and credit restructuring as well as electricity discounts.

Ingratubun is optimistic of immediate disbursal of cash aid of Rp2.4 million for MSME players in the form of grants for working capital.

MSMEs players, especially those under the auspices of Akumindo, have received a letter of requirements regarding MSMEs eligible to receive this assistance and will immediately begin submitting the same.

"The mechanism for eligibility for the grant is an entrepreneur (whose name) has never entered a bank and whose balance is less than Rp2 million. Moreover, he needs to show the proof of his business. We will complete these requirements in accordance with the mechanism to be submitted," he explained.

Ingratubun also lauded another stimulus in the PEN program wherein the government encouraged consumption growth and supported efforts to boost the purchasing power.

"Hence, the faster the distribution and the completion of legal instruments, sooner it will help to boost the nation's economy, especially for MSMEs," he stated.

President Joko Widodo (Jokowi) highlighted the need to provide funding assistance to 23 million micro, small, and medium enterprises (MSMEs) in Indonesia for working capital in the wake of the COVID-19 pandemic.

"Some 23 million MSMEs have never received funding from financial institutions or the banking system. Hence, the 23 million MSMEs must be able to avail programs to expand work program financing," President Jokowi stated at the Merdeka Palace in Jakarta on Wednesday.

The head of state delivered the statement while chairing a limited meeting themed "Continued Discussion of the COVID-19 Impact Mitigation Program on Micro, Small and Medium Enterprises" through a videoconference attended by Vice President Ma'ruf Amin, ministers, and heads of relevant state institutions.

"Based on data, 41 million MSMEs have been connected to financial institutions and banks. Beyond that, 23 million MSMEs have not been connected to financial institutions and banks," the president pointed out.

Jokowi also called on the relevant ministries and institutions to conduct a thorough assessment to decide on which of the 23 million MSMEs made the cut to receive banking services.

"For those that are bankable, distribution will be conducted through the expansion of the micro credit (KUR) program and it will encourage financial inclusion, while for those not bankable, the distribution can be conducted via UMI (Ultra Micro Financing) through Mekaar (Fostering the Economy of Prosperous Families) and other programs," the president explained.

The head of state stressed on methodically designing the expansion of financing for MSMEs in the form of emergency working capital assistance.

"MSMEs should receive this emergency capital assistance," the president emphasized.
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