inp.polri.go.id - Jakarta. Minister of Micro, Small, and Medium Enterprises (MSMEs), Maman Abdurrahman, emphasized that the root of the problem of MSME growth in Indonesia is no longer access to financing, but rather an unhealthy domestic market.
According to him, although support for People's Business Credit (KUR), training programs, and production facilities has increased over the past two decades, MSME growth remains stagnant.
"The problem today is not access to production or financing. That has increased, supported even by the government, banks, universities, and the private sector. But why is MSME growth still sluggish? Because the problem lies in the market," Maman said at a media briefing in Jakarta on Friday (2/27/2026).
Maman explained that since the KUR program was launched in 2007, total bank credit has reached IDR 8,149 trillion, with MSME credit accounting for IDR 1,580 trillion, or 19.4 percent, and non-MSME credit at IDR 6,569 trillion, or 80.6 percent.
The 2025 KUR disbursement reached IDR 270 trillion, with 4.58 million borrowers, consisting of 2.75 million new borrowers and 1.54 million graduates.
Although the loan disbursement rate continues to increase, Maman highlighted the condition of the domestic market, which he called "dirty," filled with cheap imported goods, including those imported illegally.
He explained that the phenomenon of under-invoicing exacerbates the situation, as export data from partner countries far exceeds Indonesia's import records.
"For example, if our imports are recorded at 100, China's exports are recorded at 900. This means there are 800 unrecorded goods flooding our market," he said.
Maman believes this situation is not just a matter of state revenue but has become a social problem. MSME products, which should support the people's economy, are being squeezed out by the flood of imported goods.
"We seem to be in a vicious cycle, blaming each other on the ministry or the KUR program. The key lies in the domestic market, which must be sterilized," he stressed.
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