Jakarta, 4 August 2022 -- Bank Indonesia (BI) observes the trend of increasingly solid economic recovery in this year's economic recovery. MSME players as the backbone of the national economy are not only getting up, but are getting stronger by taking advantage of niche markets outside the global market.
PT Bank Negara Indonesia (Persero) Tbk. or BNI as a global bank from Indonesia has succeeded in encouraging 40 thousand MSMEs to Go Export. Bank Indonesia also appreciates BNI's steps because it helps in increasing the country's foreign exchange reserves.
Executive Director, Head of the MSME Development and Consumer Protection Department of Bank Indonesia (BI), Yunita Resmi Sari conveyed that BNI's consistency in promoting and encouraging MSME to Go Export needs to be followed by more other banking industry players.
Moreover, this is in line with the central bank's move to market MSME products to foreign countries. BNI's steps also help BI in increasing foreign exchange reserves to support domestic economic stability.
"The development of MSMEs cannot be separated from the synergy between authorities and institutions including banking institutions. One of the MSME development programs carried out is through the facilitation of MSMEs to penetrate foreign markets. In this case, Bank Indonesia appreciates BNI's steps through BNI Xpora to encourage Indonesian Local MSMEs to be able to penetrate into foreign markets," he said.
Yunita said that the micro and small business segments continued to show positive growth. Based on BI survey, 63.6% of the number of MSMEs have experienced an increase in turnover compared to last year. In fact, 43% of the total experienced an increase in turnover for exports.
“Interestingly, our export credit increased 107% compared to the previous year, the growth was almost US$100 million. If credit increases, there will be an increase in demand, performance and an increase in the capacity of MSMEs," she added.
In order to encourage MSMEs to export, she explained that the central bank used a pulls and push strategy. From the pull side, BI utilizes seven overseas representative offices to identify markets, requirements and qualifications needed. Because, every country has different provisions from each other.
"On the push side, we prepare SMEs for us to be able to enter the market by fulfilling whatever is needed by the market, increasing capacity and requirements. So that it can fulfill the quality, quantity, and capacity," she explained.
On the other hand, BNI MSME Business Director, Muhammad Iqbal stated that the number of MSME customers who had exported were 40 thousand customers as of June 2022. That number shot up 60% on an annual basis or year on year (YoY) from 25 thousand in June 2021.
"In value, MSME exports increased from Rp. 14 trillion to Rp. 22 trillion. This means that goods produced by MSMEs fostered by BNI are much more valued by the market. The orientation is on processed food and beverage products, handicrafts, and processed seafood," said Iqbal on the same occasion.
This brilliant achievement is thanks to BNI Xpora flagship program which provides continuous assistance so that MSME players are accustomed to exporting. The process starts with curating MSME products through 200 selected branch offices spread across Indonesia, according to the export potential in each region.
After that, BNI provided assistance by cooperating with various parties such as Customs and Excise, Lembaga Pembiayaan Ekspor Indonesia (LPEI), and other parties. The goal is for MSME players to understand market needs, requirements, and increase capacity.
When MSME players are ready to export, BNI conducts business matching with diaspora spread in various countries by relying on overseas branch offices. Iqbal assessed that the number of diaspora which reached 8 million people had great potential because they could be used as ambassadors and entry points for Indonesian MSME products overseas.
Through BNI Xpora program, which was just launched last year, BNI has succeeded in bringing various MSME products to various global markets through the diaspora. He gave an example of one of MSME ornamental plants cultivators, who managed to get an export contract worth Rp 1 trillion per year for European destinations.
There is also a group of women from West Java who produce crackers which has successfully attracted the attention of one of the Diaspora in Hong Kong. Although still in a small capacity, this product has been marketed in the Hong Kong to China markets.