OJK Mandates New MSME Financing Targets
The Financial Services Authority (OJK) has recently issued a significant new regulation, or POJK, designed to bolster support for Micro, Small, and Medium Enterprises (MSMEs). According to OJK’s Board of Commissioners’ Chairman, Mahendra Siregar, this regulation compels banks to formally include financing targets for MSMEs within their business plans. This move is a departure from previous practices, where such financing was often treated as an optional or secondary activity. With the new POJK in place, MSME financing has been elevated to an essential component of a bank’s core strategy. This means banks must now submit their financing plans to supervisors for approval, with their success and implementation to be monitored and measured, ensuring a more deliberate and consistent approach to supporting this vital economic sector
A Deeper Commitment from the Banking Sector
This new regulation goes beyond simply setting targets by demanding a deeper, more committed approach from financial institutions. The OJK’s Chairman emphasized that a bank’s MSME financing plan must be fully supported by tangible commitments, including the allocation of dedicated human resources, a specific budget, and the establishment of work units focused on improving financing access for MSMEs. This strategic requirement signals that the OJK is intent on ensuring that the new policy is not just a formality but is backed by a robust and systemic effort to truly integrate MSME support into the banking industry’s operational framework. This comprehensive approach is expected to create a more effective and reliable ecosystem for small businesses to secure the capital they need to grow.
Context and the Broader Financial Landscape
The new regulation arrives at a critical juncture for Indonesia’s economy, particularly in light of recent credit data. While the OJK reported that national banking credit disbursement reached Rp8.06 quadrillion (US$499.72 billion) in June 2025—a healthy 7.77% year-on-year increase—the growth in credit specifically for MSMEs lagged behind significantly, growing by only 2.18% year-on-year. This disparity underscores the pressing need for a targeted policy intervention. The issuance of this POJK, which was finalized after consultations with various government bodies and financial associations, is a timely and strategic effort to address this imbalance. It aims to accelerate financing for MSMEs and ensure their growth keeps pace with the broader economic expansion.
