JAKARTA – The Indonesian Young Entrepreneurs Association (Hipmi) believes that the distribution of People's Business Credit (KUR) has yet to optimally reach new entrepreneurs, as banks continue to allocate funds mainly to existing debtors.
M. Ridwan Mustofa, Secretary-General of Hipmi, stated that banks remain reluctant to provide KUR to new entrepreneurs due to concerns over a potential increase in non-performing loans (NPLs).
"Banks are being extremely cautious because when their NPLs reach 3%, they become the focus of media scrutiny. However, as long as the rate remains below 5%, the NPL level is still considered reasonable," he said today.