Indonesia Expands Support for SMEs Through Finance and Digital

RRI.CO.ID, Jakarta - Micro, Small, and Medium Enterprises (MSMEs) continue to serve as the backbone of Indonesia’s economy through their contribution to job creation while supporting inclusive and sustainable economic growth. To strengthen this role, the government together with various stakeholders continues providing business facilitation, expanding financing access including the microloan called People’s Business Credit (KUR), and encouraging digital transformation so MSMEs become more competitive and capable of moving up the value chain.

In Festival for the Facilitation and Protection of Micro Enterprises on Monday, June 29, 2026, the Coordinating Minister for Economy, Airlangga Hartarto, said the microloan distribution has reached nearly half of its annual target. “These MSMEs receive People’s Business Credit amounting to nearly IDR 300 trillion and the realization has already reached almost 50 percent, specifically 50.83 percent," he said.

As of 28 June 2026, KUR distribution realization reached IDR 147.70 trillion for 2.32 million debtors or 50.83 percent of the annual financing ceiling target. This achievement reflects the Government’s commitment to continuously broaden financing access for MSME actors as one of Indonesia’s primary economic drivers.

The Festival for the Facilitation and Protection of Micro Enterprises represented a collective commitment to strengthening micro businesses through licensing access, financing, business mentoring, and legal and social protection. The event also presented various activities to reinforce collaboration among ministries and agencies, regional governments, financing institutions, business actors, and MSMEs to stimulate regional economic growth and improve national competitiveness.

During the event, Coordinating Minister Airlangga, affirmed that the Government continues expanding financing instruments available for business actors beyond KUR programs. These instruments include export financing through export financing institutions and industrial credit for labor intensive and capital intensive sectors including textiles, textile products, furniture, wood, and other strategic sectors.

He further explained that the government launched housing microloan (KUR) for the first time with a financing allocation reaching IDR 50 trillion. The program can be used for home renovations with financing ceilings reaching IDR 500 million and is targeted to support 100,000 houses.

Besides expanding financing access, the government continues strengthening services for MSME actors through digital transformation so business services become easier, faster, and more integrated. One example is the integrated digital platform called the MSME Service Application System (Sistem Aplikasi Pelayanan UMKM/SAPA UMKM), which was developed by the Ministry of Micro, Small, and Medium Enterprises together with the Ministry of National Development Planning and the National Development Planning Agency.

The SAPA UMKM platform functions as a super application designed to register, facilitate, and develop MSME businesses throughout Indonesia while providing integrated services ranging from business capacity development to legal access and government programs. The festival also included certification for seventeen Grade A incubator institutions, mass KUR agreement signings for 350 recipients from seven distributing institutions, and workshops including the use of Artificial Intelligence for business development while the government expressed optimism that policy synergy, financing, and digital transformation will make Indonesian MSMEs stronger and more globally competitive.