"Currently, we are oriented toward the productive sector so that the distribution of MSME financing can run more optimally," he said in his keynote speech at the "MSME Financing Book Study" event, according to an official statement released the same day.
The event was held at Mataram University in West Nusa Tenggara.
Hartarto said that the financing ecosystem needs to be integrated both upstream and downstream.
He expressed hope that the integrated financing ecosystem, which covers several programs ranging from social assistance programs to commercial assistance from financial institutions, would encourage more MSMEs to level up and even export their products.
So far, the government has provided several forms of financing, starting from those for ultra-micro businesses to medium-level businesses. Smallholder business credit (KUR) is one of the forms of financing support for MSMEs that comes with low interest and easy requirements.
The government has also carried out ultra-micro business financing that is sourced from the state budget (APBN), revolving funds, sharia financing, and microfinance institutions.
During the event, Hartarto underscored that the MSMEs contribute 61 percent to the national gross domestic product (GDP), or equal to Rp9,580 trillion (around US$628.36 billion). MSMEs also absorb 97 percent of the total workforce in Indonesia.
Based on data from the Ministry of Cooperatives and Small and Medium Enterprises (SMEs), Indonesia currently has 65.5 million MSMEs, which account for 99 percent of the total business units in the country.
Hartarto noted that during every crisis, MSMEs serve as a resilient buffer capable of a swift recovery.
"Therefore, it is essential to maintain the development of MSMEs to foster higher economic growth in Indonesia," he added.
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Translator: Bayu Saputra, Raka Adji
Editor: Anton Santoso
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