“The President has stated that the target is that by the end of this year, December 2025, 80 thousand cooperatives would already operate,” he said in Jakarta on Thursday.
The operational financing of the village cooperatives will be based on the business proposals submitted by them. According to the minister, this is aimed at ensuring targeted funding and encouraging independence among the cooperatives.
Setiadi said that village cooperatives can pursue several potential businesses, such as liquefied petroleum gas (LPG), fertilizer, rice, or cooking oil distribution.
He added that if a village cooperative wishes to serve as an LPG distributor, it will need to submit a business proposal that includes the amount of capital required to purchase goods from suppliers such as state-run gas company Pertamina.
Furthermore, investments in infrastructure, such as storage warehouses, will also need to be included in the proposal, which would be submitted to banks to secure loans.
The minister emphasized that the Red and White Village Cooperatives is an empowerment program that is aimed at changing the mindset of the community.
More than 80 thousand Red and White Village Cooperatives have been formed through village deliberations so far. Those cooperatives are expected to become hubs of economic and social services in village communities, offering savings, loans, and clinic services, among others.
The financing for the operations of the village cooperatives is sourced from state-owned banks, the Revolving Fund Management Institution (LPDB), regional development banks, and credit unions.
A finance minister’s regulation will be issued soon as a legal basis for the financing.
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Translator: Shofi Ayudiana, Raka Adji
Editor: Azis Kurmala
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