Throughout 2020, the Micro Business Loan Ratio showed a downward trend.

The ratio of small and medium-sized enterprise (SME) loans to total UMKM loans showed a positive trend throughout 2020. However, the ratio of micro-business loans decreased last year.

Based on data from Bank Indonesia (BI), the ratio of small business loans reached 32.36% in December 2020, up 1.34% compared to January 2020, which was 31.02%. The ratio of medium-sized business loans reached 44.99% in December 2020, up 1.91% compared to January 2020, which was 43.08%.

Meanwhile, the ratio of micro-business loans was only 22.65% by the end of last year. This ratio decreased by 3.25% compared to January 2020, which reached 25.9%.

Nationally, the ratio of UMKM loans to total banking credit throughout 2020 fluctuated. The figure ranged from 18% to 20% of total banking credit.

The lowest ratio occurred in May 2020 at 19.1%, down 0.4% from the previous month. In the following month, the ratio of UMKM loans began to show positive growth, driven by stimulus in the National Economic Recovery (PEN) program.

However, the ratio of UMKM loans in Indonesia is still far below other Southeast Asian countries, such as Singapore (39%), Malaysia (50%), and Thailand (51%). In 2024, the government targets an increase in the UMKM ratio to more than 30% so that Indonesian MSMEs can upgrade.

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