Jakarta. The Financial Services Authority (OJK) has issued a new regulation aimed at facilitating financing for Indonesia’s micro, small, and medium-sized enterprises (MSMEs), the country’s economic backbone. 

Under the regulation locally known as POJK UMKM, the authority is urging banks and non-bank financing companies to give MSMEs easier, precise, faster, affordable, and inclusive access to loans, while also remaining prudent. By non-bank firms, OJK is also referring to online lenders, pawnshops, the Indonesia Eximbank, and the financing firm Permodalan Nasional Madani (PNM).

“Banks and other lenders are expected to provide a more innovative approach in their financial products that suit the needs of the MSMEs. Our micro and ultra-micro businesses need fast and easy access. Their small and medium counterparts usually require more complex and diverse services,” Dian Ediana Rae, the chief executive for banking supervision at OJK, said.

Under the new regulation, the banks and non-bank lenders must simplify the requirements for MSME eligibility. OJK also requires the lenders to provide special financing schemes tailored to business characteristics. This includes accepting intellectual property collateral, taking into account the ecosystem and appropriate assessment methods. OJK is also urging banks to accelerate their business processes through the use of alternative credit scoring. In other words, they should take into account other data sources to assess the borrowers. They must also set up a reasonable financing cost for MSMEs.

The regulation mandates banks to prepare a financing disbursement plan for MSMEs and submit it to the agency.

OJK issued this document on September 2. The regulations will take effect in two months from that date. 

In July 2025, the nationwide bank credit issuance only rose 7.03 percent year-on-year to Rp 8,043.2 trillion (over $487 billion), a slower pace compared to the 7.77 percent recorded the previous month. Investment credit rose the highest at 12.42 percent, followed by consumer credit at 8.11 percent, and working capital credit at 3.08 percent yoy, data showed. 

From the debtor standpoint, corporate credit jumped 9.59 percent, while MSME credit grew by 1.82 percent, amid banking efforts focused on improving these small enterprises’ eligibility. Loan disbursement for the mining sector saw a double-digit growth over the same period, reaching 20.69 percent. Other sectors that rose in double digits included services (19.17 percent), transportation and communications (17.94 percent), and utilities (11.23 percent).

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