Bank Working Capital Loan Interest Rates: Which is the Highest?

Credit disbursement will greatly assist Indonesian businesses. Based on Bank Indonesia (BI) data, the average interest rate on working capital loans provided by general banks in Indonesian Rupiah is 8.94% per annum. Meanwhile, Regional Development Banks (BPDs) offer the highest interest rate on credit at 9.90%. This figure is 96 basis points (bps) above the average working capital interest rate of general banks.

The second highest working capital loan interest rate comes from private banks, at 9.57% per annum, or 63 bps above the general banks' working capital loan interest rate. Then, the working capital loan interest rate for state-owned banks (government banks) is 8.55%, or 39 bps below the general banks' working capital interest rate. Meanwhile, the working capital loan interest rate for foreign banks or mixed banks is 6.18%. This figure is 276 bps below the general banks' working capital interest rate.

The average working capital loan interest rate for general banks has decreased by 21 bps by the end of July 2021 compared to the end of 2020. The largest decrease was by foreign or mixed banks, at 58 bps, followed by BPDs at 32 bps, then state-owned banks at 21 bps, and private banks at 13 bps.

The outstanding working capital loans provided by general banks grew by 2.25% to Rp 2,114.84 trillion in July 2021 compared to July 2020 (year on year/yoy). The largest working capital loans from general banks were disbursed to the wholesale and retail trade sector at Rp 793.82 trillion (37.54%) and the manufacturing sector at Rp 443.09 trillion (20.95%).