Kadin Launches Financing Scheme to Empower Red and White Village Cooperative
The Indonesian Chamber of Commerce and Industry (Kadin) has actively prepared a specialized financing scheme to support the widespread development of the Red and White Village Cooperative program, reinforcing the national commitment to strengthening the people’s economy.
Kadin Chairperson Anindya Bakrie confirmed this strategic initiative, explaining that in accordance with the mandate of Law Number 1 of 1987, Kadin’s representation extends beyond state-owned enterprises (SOEs) and private companies to also include cooperatives and micro, small, and medium enterprises (MSMEs).
This legal and philosophical commitment is why Kadin is now placing special attention on supporting the Red and White Village Cooperatives.
Bakrie noted, “Around one month ago, we held a national coordination meeting for cooperatives and prepared a scheme to support the Red and White Cooperatives,” following a recent discussion with the Coordinating Ministry for Economic Affairs.
He did, however, clarify that the ultimate financing available for these village cooperative units is also contingent upon the government’s overarching policy decisions and funding priorities.
The government’s ambitious program was officially launched by President Prabowo Subianto in July, involving the rollout of approximately 80 thousand village cooperatives nationwide.
This massive program is primarily aimed at significantly strengthening the economic foundation at the village level.
Government Policy and Funding Mechanism for Cooperatives
The government is actively laying the necessary policy and financial groundwork to ensure the rapid operationalization and sustainability of the 80 thousand village cooperative units, transforming them into vital hubs of economic activity.
These cooperatives are strategically envisaged as integrated hubs for both economic and social services within village communities.
They are designed to offer a range of essential services, including savings accounts, loan facilities, and even basic clinic services, positioning them as central pillars of community welfare and financial inclusion.
The government has set a clear and aggressive target for the program, aiming for all 80 thousand of these newly established village cooperative units to be fully operational by November 2025.
A key enabler for this rollout is the recent issuance of Finance Minister’s Regulation Number 63 of 2025.
This regulation now allows the Red and White Village Cooperatives to formally apply for loans from major state-owned banks, namely BNI, BRI, BSI, and Bank Mandiri.
This direct access to capital is a game-changer for the cooperatives’ ability to mobilize funds and execute their service mandates.
Deputy Minister of Cooperatives Ferry Juliantono confirmed that these state-owned banks have already completed the preparation of a comprehensive manual.
This detailed document outlines the precise steps for the loan application process and the subsequent disbursement of funds across the four participating state banks, ensuring a standardized and efficient process for the village-level organizations to secure financing.
Cooperatives as Pillars of the People’s Economy
The comprehensive effort by Kadin, supported by the government’s policy framework and the dedicated financing from state-owned banks, highlights the critical role of the village cooperative structure in the national strategy to bolster the people’s economy.
The Red and White Village Cooperatives are more than just financial institutions; they are a direct tool for empowering local communities and fostering bottom-up economic growth.
By serving as providers of savings and loans, they combat the influence of informal, high-interest lenders and provide accessible capital for MSMEs operating at the village level.
This initiative directly addresses regional economic disparities by focusing resources and services directly where they are most needed.
The collaboration between a major national business organization like Kadin, which represents large corporations, and the grassroots cooperative movement is symbolic of a shared national vision.
It recognizes that sustainable economic growth requires strong linkages between the large corporate sector and the fundamental foundation of the people’s economy, which is largely driven by MSMEs and cooperatives.
The target of making 80 thousand village cooperative units fully functional within a short timeframe signifies the government’s commitment to rapidly deploy this economic model as a central component of its overall development strategy, ensuring that economic benefits are inclusive and reach every corner of the archipelago.
