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Bank Rakyat Indonesia (BRI), the publicly listed lender that
focuses on micro, small and medium enterprises, is considering
providing technical assistance to similar operations overseas,
following a request to do so from the International Finance Corporation.
"Yes, we have been invited to provide assistance abroad to help other
countries develop their micro and SME sectors," BRI micro and SME
director Sulaiman Arif Arianto said Tuesday on the sidelines of a BRI
gathering.
"But we are still studying the issue as we don't want to act
precipitously, especially given that we still have great market
opportunities here," he added.
According to Sulaiman, only 15 percent of the 42 million micro and SMEs
in Indonesia have access to sources of financing, such as
national-scale and rural banks, cooperatives and pawn shops.
The International Finance Corporation (IFC), the private-sector arm of
the World Bank, has invited state-owned BRI to assist in developing the
micro and SME sectors in other countries using similar schemes to those
BRI has developed here.
Sulaiman said that BRI would receive fees in return, if management
agreed to accept the offer.
Indonesia's fourth-largest lender, with around Rp 140.5 trillion
(US$15.3 billion) in assets, BRI is regarded as a potential role model
for lenders to the micro and SME sectors.
With the IFC allowing BRI to decide which countries it would focus on,
Sulaiman said the bank would likely concentrate on those in Asia and
Africa.
As of September last year, BRI had provided Rp 86.7 trillion ($9.4
billion) in loans to micro and SMEs, representing about 87.7 percent of
its total outstanding loans.
This figure was 20 percent higher than in the previous year.
The other 12.3 percent of BRI's total loans was provided to the
corporate sector.
The bank expects to disburse another Rp 17.34 trillion in loans to
micro and SMEs this year so as to maintain its proportion of lending to
these sectors at above 80 percent.
BRI managed to reduce its level of non-performing loans (NPL) in the
micro and SME sectors to 1.62 percent last year from 2.09 percent in
2005, and says it will hold the level of NPLs this year at a maximum of
2 percent.
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