Our estimates are based on various indicators. The sales index, consumer confidence, credit growth, current account balance, exports are very good; we are optimistic that economic growth in the third quarter of 2022 can be higher than 5.5 percent.
Jakarta (ANTARA) - Governor of Bank Indonesia (BI) Perry Warjiyo has said that lending is expected to grow 11 percent on an annual basis this year and up to 12 percent in 2023.

"For credit, we estimate that next year, credit can grow by 10 to 12 percent annually. This year, it is around 9 to 11 percent," he informed at a press conference in Jakarta on Thursday.

Credit growth has continued to increase, supported by demand from business players and banking supply.

Bank liquidity is still loose, as seen from the ratio of third-party funds (DPK), which reached 27.35 percent in September 2022.

With liquidity still being kept loose, the impact of the increase in BI’s 7-day reverse repo rate reference rate on bank lending rates is expected to be slower.

“So, banks do not have to rush to raise credit rates because we maintain very loose liquidity so that interest rates are still a positive factor for banks to channel credit," Warjiyo said.

In addition, Bank Indonesia and the Financial System Stability Committee (KSSK) have continued to provide incentives to banks to continue to disburse loans to 42 priority sectors, including the micro, small, and medium enterprise (MSME) sector.

BI is also offering other incentives, including a zero-percent down payment (DP) policy and reduced minimum statutory reserves (GSM) of 1.5 percent.

"The BI credit survey shows that the appetite and desire of banks to disburse credit is still growing positively," he noted.

With growth in public consumption, exports, and investment, demand for credit is also expected to continue to grow.

BI has forecast that in the third quarter of 2022 economic growth will be more than 5.5 percent on an annual basis.

"Our estimates are based on various indicators. The sales index, consumer confidence, credit growth, current account balance, exports are very good; we are optimistic that economic growth in the third quarter of 2022 can be higher than 5.5 percent," Warjiyo said.

Further, Bank Indonesia's (BI's) Banking Financing Demand and Supply Survey indicated increased demand for corporate financing in September 2022, as reflected in the weighted net balance (SBT) of 18.4 percent, or higher than August's level of 17.9 percent.

Several sectors recorded an increase in financing needs, including transportation and warehousing, agriculture, as well as information and communication, especially to support operational activities and pay off maturing obligations.

In an official statement, director of the BI’s communication department, Junanto Herdiawan, said that financing needs were met mainly from own funds, which were still the major financing source, followed by the utilization of the withdrawal allowance facility—both of which increased compared to the previous month.

The distribution of new loans by banks in September 2022 also indicated positive growth, as indicated by the SBT value of new lending of 56.8 percent.

The main factors influencing the forecast for new lending were future monetary and economic prospects as well as demand for financing from customers.

Meanwhile, for the entire period of the third quarter of 2022, the supply of new loans is also projected to grow positively, albeit slightly slower than in the previous quarter.

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Translator: Sanya D, Azis Kurmala
Editor: Rahmad Nasution
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