Indonesia Slashes Mekaar Loan Interest Rates to 8% for Underprivileged Women Entrepreneurs

Indonesian Minister for Micro, Small, and Medium Enterprises (UMKM) Maman Abdurrahman announced a significant reduction in loan interest rates for the Mekaar program, lowering them from a range of 18-25% to approximately 8%. This change is set to take effect in early September 2026.

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Alhamdulillah, it has been decided that the PNM Mekaar loan interest rate will be around eight percent. God willing, it will take effect around the beginning of September.

The decision, confirmed during a meeting of the People's Business Credit (KUR) Steering Committee, aims to ease the financial burden on the roughly 14 million underprivileged women who are clients of the Mekaar program, managed by PT Permodalan Nasional Madani (PNM). Previously, these high interest rates were attributed partly to PNM's intensive support model, which includes direct mentoring and monitoring by account officers and advisors.

President Prabowo Subianto initiated the directive for more affordable loan terms, specifically targeting women entrepreneurs in the ultra-micro and super-micro business segments. "The President's order is that Mekaar loan interest rates must be below 10% so as not to burden the mothers who are in the underprivileged group," Maman stated.

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The President's order is that Mekaar loan interest rates must be below 10% so as not to burden the mothers who are in the underprivileged group.

To achieve the target of 8% interest, the Ministry of UMKM, in coordination with Danantara and PNM, will provide a subsidy of approximately 10%. The ministry and related bodies are committed to ensuring the implementation of this policy is precise, effective, and beneficial for all women business owners participating in the program. The President emphasized the need for swift execution to ensure beneficiaries are not burdened by high interest rates any longer.

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The President ordered the execution of the Mekaar loan interest rate reduction to be accelerated immediately so that it can be directly enjoyed by Mekaar program customers and they are no longer burdened by high interest.