JAKARTA - Bank Indonesia Banking Survey indicates that new quarterly credit growth slowed in the first quarter of 2020. This is reflected in the net weighted balance (WNB) of new credit demand in quarter I-2020 of 23.7%, lower compared to 70.6% in the previous quarter and 57.8% in quarter I-2019. By type of use, the slowing growth in demand for new credit originated from all types of credit, with the largest decline in consumption credit.
The lending policy in the second quarter of 2020 is predicted to be more relaxed. The forecast is indicated from the Lending Standard Index (ILS) of 9.1%, lower than 10.9% in the previous quarter. Relaxed standards credit distribution will primarily be made for working capital and MSME credit. The aspects of lending policy that will be relaxed are credit interest rates, credit approval fees, credit terms, and credit ceilings.
The survey results indicate a decline in credit growth for 2020. Respondents forecast credit growth in 2020 of 5.5% (yoy), lower than the realization of credit in 2019 by 6.1% and the forecast in the previous survey of 9.4%. (LM)