Bank Indonesia will push the country's banking sector to allocate a greater amount in loans to small- and medium-sized enterprises (SMEs) this year as part of its efforts to accelerate economic growth, a top official has said.
"We'll ask the banks to allocate a greater amount of loans (to the SME sector) this year. I'm confident that 2004 will be much better because of the higher economic growth target," Bank Indonesia Governor Burhanuddin Abdullah said on Friday.
He said, however, that the SMEs must improve their management ability and business administration skills to make them more bankable.
He pointed out that of the Rp 42,300bn (US$5bn) lending target for the SME sector last year, only around half was taken up by SMEs.
He was quoted as saying that the relatively low absorption rate was because many of the SMEs were not bankable, partly due to their lack of necessary administrative documentation for loan application.
