JAKARTA – The Financial Services Authority (OJK) has limited the credit distribution of Rural Banks or Smallholder Credit Banks (lit. Bank Perkreditan Rakyat/BPR) to 30% of their total capital, applicable for both conventional and sharia rural banks.
Darmansyah, Director of Public Relations of OJK, claimed that the legal statement that regulates this financing facility distribution lies in OJK Regulations No.23/2022 regarding the Maximum Limit of Credit Distribution of Conventional Rural Banks and the Maximum Limit of Fund Channelling of Sharia Rural Banks. “It was issued based on principles and the harmonisation between both financing distribution maximum limits,” he explained thoroughly, quoted today (12/12).
According to Darmansyah, the issuance of this regulation is adjusted following the financial health evaluation criteria that had just been released, as well as online reports from the OJK Online Reporting Application (APOLO) for Conventional and Sharia Rural Banks.
Said regulation is intended to inspire rural banks to grow into more agile, adaptive, and resilient institutions, as well as giving more contributions in channelling financing facilities to MSME.
Specifically, the regulation states that the credit channelling for related parties is capped at 10% of banks’ capital, and the fund placement between banks is capped at 20%, while the maximum credit for unrelated users is set to 20%. (LK/ZH)