People’s Business Credit or abbreviated as KUR is a government program to promote the economy by providing capital assistance for micro, small and medium enterprises ( UMKM ) in the form of credit or loans. This program is given or channeled through banking institutions selected by the government.
This program (KUR) or people’s business credit is a good step for economic progress. As we all know, although the scale is medium to low, UMKM are an important part of the national economy. UMKM play a role in creating job opportunities.
Maybe you are one of the business actors who are starting their own business and need access to light capital. So if yes, you can try the People’s Business Credit program which is made as light as possible in terms of interest and loan time limits (tenors).
Definition of People’s Business Credit (KUR)
The People’s Business Credit Program (KUR) is a government program that provides access to financing for Micro, Small and Medium Enterprises ( UMKM ). This financing is channeled through channeling banks that have been determined with a guarantee pattern.
This program aims to provide support to UMKM that are considered productive but still need capital injections to develop more. The areas covered by this program are various forms of business, be it agriculture, industry, fisheries and marine affairs, forestry or even savings and loan services.
In fact, 100% of the People’s Business Credit funds disbursed came from channeling bank funds. The government’s role is to provide guarantees. Therefore, UMKM that get access to KUR are required to pay off the KUR they receive by paying installments according to the amount of interest and the agreed time period.
– The Purpose of People’s Business Credit
As briefly mentioned above, in general the existence of KUR aims to assist UMKM actors in accessing capital. The advancement of UMKM, which are an important part of the country’s economy, will create more jobs, thereby reducing poverty.
– KUR Rate and the Ceiling
The KUR interest set by the government is 6%. Meanwhile, the current unsecured KUR ceiling is a maximum of IDR 100 million with a KUR interest subsidy of 3 percent which is extended until December 2021. So the 2021 People’s Business Credit interest rate will be 3% because of this subsidy.
Types of People’s Business Loans ( KPR )
KUR consists of several types that are tailored to the target recipient. Here are the types of People’s Business Credit (KUR) that you need to know.
1. Micro KUR
Micro KUR is a type of people’s business credit that is intended for micro-scale small businesses. The maximum loan size or credit limit is limited to only Rp. 25 million, but it can be different, depending on the policy of the channeling bank.
Micro KUR targets are small businesses that are considered productive and prospective in terms of profit. The hope is that the recipient can pay the credit installments on time as agreed with the bank. There are two kinds of loan repayment periods, namely three years for working mode credit and five years for investment credit.
Of course, there are several main requirements that must be met by prospective debtors (borrowers) so that their applications are approved and obtain Micro KUR ( people’s business credit ). Some of these requirements include, among others.
That business actors must be serious and correct in running their business in the last three months, business actors have attended entrepreneurship training as evidenced by certificates and the business run by the prospective debtor is categorized as a productive business.
2. KUR Retail
The segment of KUR Retail is a middle-class business that is able to pay installments and flat or annuity interest. In terms of targets, Micro KUR and Retail KUR are clearly different, so the maximum loan capital is also far apart, which is IDR 500 million.
In addition to the maximum loan or high ceiling, KUR Retail also offers loan terms that tend to be longer, namely a maximum of four years for working capital financing and five years for investment financing.
Meanwhile, the requirements needed to apply for Retail KUR ( people’s business credit ) are not much different from the requirements for Micro Credit. There may be a slight difference, namely the demand that the borrower has collateral or collateral.
3. Indonesian Labor KUR
The Indonesian Migrant Worker’s KUR is different from the previous two types of KUR. The capital assistance provided by the government does not target business actors. As the name suggests, the Indonesian Manpower KUR is made for Indonesian workers (TKI) who work abroad.
The goal is that TKI who want to leave and travel abroad have initial capital. So that the community can get this assistance fairly and receive it in a tangible form, the KUR TKI is designed with a special structure for equitable allocation, stabilization and distribution.
The nominal problem is that prospective TKI who are approved for KUR will receive a maximum capital loan of up to IDR 25 million with an interest rate of 7% per year. Meanwhile, the repayment period is a maximum of three years after the loan is disbursed.
There are requirements in the form of documents that need to be prepared for this type of KUR ( people’s business credit ), namely :
– Certificate of domicile and
– Health certificate from a doctor.
– In addition, prospective migrant workers must also have a work contract agreement.
Criteria for People’s Business Loans
There are several criteria set for KUR recipients, including the following :
- Prospective debtors are not currently receiving credit for other businesses from banks or program credit from the government, however, consumer loans such as mortgages, motor vehicle loans and others are still allowed.
- Submit a Clearance Certificate from the previous bank specifically for UMKM who are still registered in the BI Debtor Information System, but have paid off their loan obligations.
- Especially for Micro KUR ( people’s business credit ), there is no checking of the Bank Indonesia Debtor Information System.
- In accordance with the results of the business feasibility analysis of the prospective debtor, the decision to grant KUR is fully the authority of the Channeling Bank.
How to Get People’s Business Credit
The stages that prospective debtors must go through to obtain People’s Business Credit are as follows:
- UMKM submit a KUR application by providing a KUR application letter to the channeling bank. The application is accompanied by other document requirements such as business legality, business licensing, financial records and so on.
- The channeling bank will evaluate and analyze the feasibility of the UMKM business based on the data from the UMKM application.
- If the channeling bank considers the UMKM business feasible, then they will approve the KUR application. This decision is entirely the authority of the bank without any government role.
- Once approved, the bank and UMKM sign a Credit Agreement.
- UMKM are required to pay installments to return KUR to the bank until it is paid off.
Effective Interest Calculator for KUR
The effective interest for KUR ( people’s business credit ) or other loans is calculated based on the principle that the principal monthly installments are fixed, while the monthly interest rate follows the remaining unpaid installments.
You can take advantage of various effective interest calculator applications to calculate the amount of installments available on the play store or app store.
Terms of KUR According to The Bank
The decision to accept the People’s Business Credit is entirely the right of the channeling bank. Of course, each bank has its own considerations for accepting or rejecting an application.
The following are the requirements for BRI, BNI and Mandiri People’s Business Credit:
1. BNI People’s Business Credit Terms
The BNI People’s Business Credit Facility provides a maximum loan of up to Rp. 500 million with an adjustable tenor. Usually, for working capital loans, BNI provides a period of three years.
While for investment loans, the repayment period is five years. Meanwhile, the normal interest outside the subsidy for KUR BNI is 6%.
Debtors who are allowed to apply for KUR at BNI must be Indonesian citizens (WNI) and have a business that has been running for at least six months. In addition, they are not allowed to be in other loans, be it credit from banks other than BNI or government program loans.
As for age, BNI requires prospective debtors to be at least 21 years old or married. As for the document requirements, they must include such as KTA, Family Card, photocopies of letters and marriage certificates for those who are married.
Related to business, documents that must be completed are business legality such as SIUP, SITU, TDP, HO, or a business certificate issued from the kelurahan or sub-district. Debtors must include NPWP if they apply for KUR above IDR 50 million.
In addition, for loans above IDR 50 million, the debtor is required to attach a photocopy of proof of land ownership, IMB, and PBB as collateral. This guarantee document is not required for debtors who apply for loans below this figure.
2. Terms of People’s Business Credit ( BRI )
The three types of KUR at BRI have different ceilings, for Micro KUR the ceiling is up to Rp. 50 million, Small KUR is up to Rp. 500 million, and KUR TKI has a ceiling of up to Rp. 25 million.
Meanwhile, the interest rate offered is 6% excluding subsidies. There are no administrative and provincial costs for KUR ( people’s business credit ) BRI.
The conditions for unsecured BRI bank loans for micro businesses ( KUR Mikro ) are individuals who have productive and viable businesses that have been running for at least six months and are not currently receiving loans from banks or government programs except for consumer loans.
Another requirement is the document requirements, where the debtor needs to attach his identity in the form of an ID card, family card ( KK ) and a business license.
While the requirements for the type of KUR TKI are prospective TKI who will go to work abroad for work. They must include required documents in the form of ID cards, family cards, work agreements with service users, placement agreements, passports and visas.
Small KUR will be given to prospective debtors who run productive and viable businesses and are not currently receiving credit from other banks or credit from government programs. Businesses run by small BRI KUR debtors must have been running for at least six months.
For customers who want to be approved for this type of People’s Business Credit application, they must have a micro and small business license or other equivalent business license.
3. Bank Mandiri Business Credit Terms
Mandiri People’s Business Credit consists of four types, namely Micro KUR, Retail KUR, and TKI placement KUR. Each has a different ceiling, namely IDR 25 million for Micro KUR, IDR 200 million for Retail KUR, and IDR 25 million for TKI Placement KUR.
Furthermore, there is also a special KUR that is given to business groups in the form of clusters using a business partner system. The ceiling for this type of People’s Business Credit is a maximum of Rp. 500 million.
The Mandiri KUR interest rate is 6% per annum excluding subsidies. Meanwhile, the repayment period varies depending on the type of credit. For example, for Retail KUR, the maximum term of working capital credit is three years, while for investment credit it is five years.
For the application requirements, the Micro KUR and Retail KUR are the same, namely the prospective debtor may not be receiving other credit such as mortgages, motor vehicle loans, or credit cards.
However, debtors can attach a payment certificate if they have credit outside the KUR program but have already paid it off. In addition, prospective debtors must be at least 21 years old or married and not on the national black list of check takers or blank bilyet giro.
Finally, of course, the prospective debtor must have been running a productive and feasible business for at least six months. Meanwhile, for the type of KUR for the placement of TKI, the minimum age of the debtor is 21 years as evidenced by an identity card in the form of an ID card or family card.
For prospective migrant workers who are 18 years old, must attach a letter of permission from their husband, wife, or parental guardian to work abroad. They must also have a work agreement of at least two years with their service users who are placed by PPTKIS, the government or individuals
That is a complete explanation of what the People’s Business Credit (KUR ) is complete with the requirements for submission. One of the advantages of KUR over other business loans is its very low interest rate and allows debtors to receive loans without collateral.
KUR ( people’s business credit ) is indeed designed for small to medium business actors who want to access capital assistance. So for those of you who feel that you meet this classification, it doesn’t hurt to try this program in order to advance the business you are starting.