Indonesia expands low-interest loans through cooperatives: President

Jakarta (ANTARA) - Indonesian President Prabowo Subianto stated the Red and White Village Cooperatives will provide micro and super-micro loan services with an annual interest rate of 8 percent to expand public access to financing.

The president noted that this financing scheme would include the Mekaar (Fostering Prosperous Family Economy) collateral-free lending program, with its interest rate slashed from 22 percent to 8 percent per year.

"The interest rate used to be 22 percent, and I have reduced it to 8 percent. Compared to 22 percent, 8 percent is quite a relief," he said during the main celebration of the 79th National Cooperative Day in Jakarta, on Sunday.

He said that the village cooperatives will not operate solely as conventional savings and loan cooperatives that rely on members' deposits, but will function as institutions providing microcredit services to the wider community.

Beyond financing services, the cooperatives will be developed as integrated hubs for village economic services to support local economic activities.

Various facilities will be incorporated within a single hub, including grocery stores, savings and loan services, village pharmacies, logistics centers, storage warehouses, and cold storage units to maintain the quality of agricultural, plantation, fishery, and other commodities.

He also stated the Red and White Village Cooperatives would become the main channel for the distribution of various government-subsidized goods to ensure they reach eligible beneficiaries.

"The Red and White Village Cooperatives will serve as integrated hubs for village economic services," Prabowo said.

Related news: Village co-ops to boost people's prosperity by Rp223 trillion: Prabowo

Translator: Maria Cicilia, Raka Adji

Editor: Bayu Prasetyo

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