The Risk Government Center, Faculty of Administrative Sciences, University of Indonesia (FIA UI) is holding a webinar series to discuss collaboration to strengthen MSMEs and Indonesian Cooperatives through credit guarantee facilities via the zoom meeting platform on Wednesday, July 27 2022.

This event presented speakers from financial regulators (OJK), Credit Guarantee Professionals and Academics consisting of Dr. Arif Budimanta, Special Staff to the President of the Republic of Indonesia for Economic Affairs; Dr. Julius, MA. Expert Staff of the Minister of Cooperatives and SMEs for Productivity and Competitiveness; and Dr. Toto Pranoto who is the Director of Indonesian Cooperation.

The event started with singing the Indonesia Raya National Anthem and reading a prayer by Mr. Rahmat Ramli. Then, before the event continued to the main event, namely the presentations from the three speakers, Dr. Diding S. Anwar, FMIII delivered his remarks to the webinar participants.

“The background to the theme ‘Strengthening Indonesian MSMEs & Cooperatives Through Credit Guarantee Facilities’ is because MSMEs and cooperatives are Indonesia’s leading economic pillars. Because of that, of course, its development needs to be continuously supported to grow and increase in business scale. Fulfilling the needs of MSMEs and cooperatives is a key factor in order to be able to upgrade escalatively,” he said.

The government, said Dr.Diding, has created a legal umbrella regarding MSMEs and cooperatives, then guarantee companies in the industry play a role in facilitating and bridging MSMEs so that they can carry out their functions properly. For this reason, pentahelix collaboration is needed across generations and across ABGC&M (academic, business, government, community, and media).

“OJK realizes that there are wide opportunities for guarantee institutions to increase their role in developing the MSME sector to gain access to funding. Apart from that, collaboration from various parties is urgently needed, starting from the provincial and regional governments,” said Bambang W. Budiawan, Head of the Department of Supervision of the Non-Bank Financial Industry (IKNB) 2B OJK.

The event moderated by Dede Suryanto, S.Sos., M.Sc. This was then continued with the delivery of material by Dr. Arif Budimanta by explaining Indonesia’s condition during the Covid-19 pandemic.

“The world is currently threatened with a state of stagflation where inflation is high and on the other hand it is experiencing pressure on economic growth due to a structural break due to the pandemic. Apart from that, there is also the threat of a recession,” said Dr. Wise.

Dr. Arif continued that especially for MSMEs, it turned out to experience higher growth than national credit. This phenomenon shows an opportunity that the acceleration of economic growth in MSMEs has excellent improvement and growth motivation. In addition, Dr. Arif explained that the economy in Indonesia showed well-managed values

After the presentation from Dr. Arif, the second resource person namely Dr. Yulius continued the presentation session with a presentation entitled “Government Support to Increase MSME Productivity and Competitiveness Through Capital and Credit/Financing Guarantees.”

“The COVID-19 pandemic has had an impact, both from a domestic perspective, namely low productivity and competitiveness, low added value and low labor mobility. However, in Indonesia the growth of micro business loans continues to increase significantly and medium business loans are still slowing down,” said Dr. Julius.

National economic recovery, said Dr. Yulius, in the midst of the onslaught of the impact of the pandemic, this can be done through increasing MSMEs, namely through a financing program consisting of grants, relaxation, and facilitation; then there are business processes consisting of digitization, partnerships, and HR; and lastly is market access, namely trade areas, procurement of goods and services, and protection.

Dr. Toto Pranoto continued the discussion session by saying that 7 out of every 10 MSME business actors needed business capital as the most needed. Dr. Toto said that state support for the development of MSEs was actually quite large. Now, the thing that needs to be done is to see whether these efforts have been carried out optimally or not.

“To overcome all economic problems, there are several strategies, such as the application of the Warehouse Receipt System – Alternative Financing which helps increase sales value and protects the ability of business actors. The second is Go Digital so that it will be more accepted by business actors in the micro sector which is very beneficial.

Lastly, Dr. Toto explained that the expectations of MSMEs in the guarantee industry consisted of several points, namely the existence of a proper guarantee institution and not yet bankable, how to rank a proper MSME platform, launch an MSME partnership program, provide assistance to MSMEs, create meeting forums with MSMEs, and increase technology literacy for MSMEs.

Then, a question and answer session took place which received various responses from the webinar participants. One of them is Laurensius Manurung who questioned the small absorption of funds or capital in MSMEs and regarding the small number of MSMEs that have legality.

“This is where it is necessary to build a rating agency so that you can see the condition of each MSME and also make it easier to channel funds,” said Dr. Toto. “The issue of easy access to financing has actually been carried out by the government through people’s business credit, the guarantee method, insurance. What is needed here is a forum to sit together between the various parties involved to overcome these problems, “said Dr. Wise.

After the discussion session, FIA UI handed over e-certificates to the keynote speakers, panelists and moderators as a form of appreciation for participating in this webinar. The event was then closed with a group photo.