In 2023, Indonesia's micro-scale industries were concentrated on Java

The Central Statistics Agency (BPS) recorded 4.18 million micro-scale industrial companies in Indonesia in 2023.

BPS defines micro-scale industries as manufacturing companies with 1-4 employees.

According to BPS data, micro-scale industrial companies are concentrated on Java Island, particularly in East Java, Central Java, and West Java provinces.

Here are the top 10 Indonesian provinces with the most micro-scale industrial companies in 2023:

1. East Java: 862,057 units
2. Central Java: 811,039 units
3. West Java: 584,903 units
4. West Nusa Tenggara: 131,958 units
5. Yogyakarta: 129,289 units
6. East Nusa Tenggara: 124,566 units
7. Bali: 120,752 units
8. South Sulawesi: 119,613 units
9. North Sumatra: 119,539 units
10. Aceh: 106,527 units

According to the BPS report, approximately 68.05% of the 4.50 million micro and small industrial businesses (with 319,456 small-scale industries) faced difficulties operating in 2023, with 35.56% experiencing capital constraints.

This capital constraint persists despite the Indonesian government launching the Ultra Micro Credit (UMi) program in 2017.

Unlike the People's Business Credit (KUR), UMi focuses on micro-entrepreneurs, particularly in remote areas often lacking access to formal financial services.

"Through this scheme, UMi not only provides a short-term solution but also contributes to poverty reduction and improved public welfare in the long term," said Ismed Saputra, the CEO of the Government Investment Center, Ministry of Finance of the Republic of Indonesia, in a press release (October 28, 2024).