Non-Performing Loan Ratio for MSMEs Highest in Regional Banks

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Adi Ahdiat 23/07/2024 10:42 WIB

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Based on OJK data, the highest Non-Performing Loan (NPL) ratio for MSMEs was recorded at Regional Development Banks (BPDs), reaching 7.83% in April 2024.

Non-Performing Loan Ratio of MSMEs by Lending Bank Category (April 2024)

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Non-Performing Loan Ratio of MSMEs by Lending Bank Category (April 2024)

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Based on data from the Financial Services Authority (OJK), the total outstanding principal loan balance owed by micro, small, and medium enterprises (MSMEs) nationwide reached Rp1,461 trillion in April 2024.

Of this amount, Rp62.23 trillion was classified as non-performing loans (NPLs), equivalent to 4.26% of the total outstanding debt.

When broken down by lending bank category, the highest ratio of non-performing loans was found in regional development banks (BPDs).

In April 2024, the outstanding principal loan balance owed by MSMEs to BPDs reached Rp110.09 trillion, with non-performing loans totaling Rp8.62 trillion (7.83% of the outstanding balance).

Next, the outstanding MSME debt to national private banks reached Rp430.72 trillion, with non-performing loans of Rp18.04 trillion (4.19%).

Meanwhile, the outstanding MSME debt to state-owned banks (BUMN banks) reached Rp920.63 trillion, with non-performing loans of Rp35.56 trillion (3.86%).

Currently, the OJK is drafting a Government Regulation (RPP) regarding write-offs or the cancellation of non-performing loan receivables for MSMEs.

However, there is no definite information on when this regulation will be finalized and implemented.

"That RPP [MSME write-off] is currently underway, meaning it's in the finalization stage along with several other RPPs. Hopefully, it can be done more quickly," said Dian Edina Rae, Executive Head of Banking Supervision at the OJK, as reported by Bisnis.com on Friday, June 28, 2024.

Editor : Adi Ahdiat

"Disclosure: This is an AI-generated translation of the original article. We strive for accuracy, but please note that automated translations may contain errors or slight inconsistencies."