State-owned publicly listed Bank Mandiri has affirmed that the government’s policy to forgive non-performing loans (NPL) for a million Micro, Small, and Medium Enterprises (MSMEs), including farmers and fishers, will not impact its financial performance.
This debt relief program is part of Government Regulation No. 47/2024, signed by President Prabowo Subianto.Teuku Ali Usman, Bank Mandiri’s Corporate Secretary, said the policy aligns with the bank’s commitment to strengthening the grassroots economy.
The debt written off has already been accounted for as a “write-off” in the bank’s balance sheets, resulting in no financial loss to the company.
“This strategic move aims to enhance MSMEs’ competitiveness and long-term capacity, reinforcing Indonesia’s grassroots economy,” Ali said on Thursday, November 7, 2024.
He added that historical analysis shows low recovery rates on MSME loans, especially for sectors like agriculture and fisheries, rendering minimal financial impact on the bank.
Bank Mandiri also supports Prabowo’s efforts to give farmers and fishers renewed access to banking services, strengthening national food security initiatives and nutritional assistance programs.
President Prabowo expressed hope that by clearing these debts, small-scale producers can focus on agricultural and fisheries production without financial burden. He emphasized that this policy respects and values the essential contributions of food producers in Indonesia.
Many farmers and fishers previously struggled to secure loans due to existing debt records, pushing them to seek high-interest loans from private lenders or online platforms. With this policy, they now have renewed potential for stable banking access.
