Jakarta. Bank Rakyat Indonesia, or BRI, the country’s second-largest lender by asset, said its disbursement of loans to small and medium-sized enterprises, or SMEs, a segment in the first quarter of this year exceeded the level at the start of the Covid-19 pandemic. 19.

The figure presents the latest positive signal of Indonesia’s robust economic growth in the first quarter, despite the shocks of the third pandemic wave caused by the Omicron variant and inflation resulting from high global commodity prices and geopolitical conflicts in Ukraine.

Disbursement of BIS loans to the SME segment increased by 29% to Rs 21.3 trillion in the period January to March this year from Rs 16.5 trillion in the same period last year . The Covid-19 pandemic was first detected in Indonesia on March 2, 2020 and the BIS only managed to disburse Rs 13.1 trillion for the SME segment during this quarter.

“We can see, based on the facts on the ground, that small and medium enterprises have started to recover strongly, surpassing even the early days of the pandemic,” said Amam Sukriyanto, director of small and medium enterprises of the BRI, in a statement on Saturday.

More businesses were confident of taking out more loans, which they use for operations or expansion, during the period. BIS said 46,306 businesses received the loan in the first quarter, compared to 33,269 and 23,581 customers in the same period last year and 2020, respectively.

Amam said the BIS is now more optimistic about Indonesia’s economy growing more robustly this year, as most credit is absorbed by productive sectors and spread relatively evenly across regions, not just major ones. cities.

“Sectors related to basic needs, such as trade, dominate BIS credit distribution in the small and medium enterprise segments, reaching 61% of total SME lending,” he said. He said the agricultural sector accounted for 12% of loans, and the labor-intensive housing sector followed with a 7% contribution.

The SME segment also appeared to be recovering from the pandemic, Amam said. At its peak in December 2020, the BIS had to restructure 47.38% of its SME loan portfolio.

“That proportion continues to fall dramatically, and now it is down to just 36.19%. their business, and they again showed their ability to repay their loans,” he said.

Amam added that this positive achievement was inseparable from the government’s stimulus for micro, small and medium enterprises (MSMEs) to help them cope with the impact of the pandemic. The stimulus includes the National Economic Recovery Program (PEN), People’s Enterprise Credit (KUR), and the Financial Services Authority (OJK) policy easing, which relieves the financial and banking sector during the pandemic.

Robust growth in SME lending numbers often precedes strong economic growth.

The Economic and Community Research Institute (LPEM), an economic think tank under the Department of Economics and Business, University of Indonesia, estimated that Indonesia’s annual GDP growth in the first quarter of 2022 was about 4.85%, which is in the range of 4.75 to 4.95%. Scope. That was slightly slower than the 5.02% growth in the fourth quarter of last year.

Despite the disruption caused by the Omicron variant in early 2022, economic activity continued to grow in the first quarter and trade balance performance still looked good, the institute wrote in a report on Friday.

“Despite the various challenges, we still believe that economic growth for the whole of 2022 will return to pre-pandemic levels of 5%, within a range of 4.9% to 5.1%,” the statement said. LPEM economist, Teuku Riefky.

The Central Statistical Agency (BPS) is expected to release Indonesia’s first quarter GDP figures on Monday.