With capital, either in the form of cash or farming production means, farmers can conduct business, from tilling land, growing crops to harvesting.

The COVID-19 pandemic, followed by the imposition of large-scale social restrictions (PSBB), has led to low prices and supply chain disruptions, causing many farmers to incur losses. 

This explains why state-owned lender Bank Rakyat Indonesia (BRI), which recognizes the importance of empowering farmers, continually helps them cope with the problem because farmers play a crucial role in ensuring food security.

To understand the issues faced by farmers, Bank BRI organized “Dialog on Food Security” in Balai Desa Bangun Rejo, Lampung Tengah.

The event, held on June 11, was attended by Bank BRI’s president director Sunarso and Lampung province’s deputy governor Chusnunia Chalim.

Sunarso said that amid the pandemic, ensuring food security was increasingly crucial and Bank BRI, whose major focuses include empowering micro, small and medium enterprises (MSMEs) is committed to supporting the government programs related to the concern.

“This can be concretely evidenced by BRI’s role as one of the banks that distributes loans for micro credit program Kredit Usaha Rakyat (KUR), in which BRI’s KUR disbursement for the agriculture sector reached more than 30 percent and its KUR Micro disbursement for the production sector was recorded at more than 60 percent,” he added.

Bank BRI’s policy on KUR disbursement is in line with President Joko Widodo’s insistence on channeling the government’s KUR to more productive sectors, particularly microbusinesses in the agriculture sector, so that the loans have a bigger impact on the economy.

The government has raised the value ceiling of total KUR loans to be disbursed in 2020 to Rp 190 trillion (US$13.55 billion) and has committed to a gradual increase of the ceiling to Rp 325 trillion by 2024. The microcredit interest rate was also brought down to 6 percent next year from the current 7 percent.

In early April, through its subsidiary, BRI Ventura, Bank BRI injected funds into start-ups in the field of agriculture (agritech), namely TaniGrup, through participating capital to minimize the risk faced by MSMEs players, especially farmers.

The additional investment will be earmarked to expand TaniGroup’s service and operational coverage so that more farmers, players of MMEs engaged in agriculture sector and customers, can take advantage of the TaniGroup platform.

TaniGroup is engaged in two major lines of business, TaniHub and TaniFund. TaniHub runs an e-commerce that connects farmers directly to buyers and TaniFund is engaged in digital lending or peer-to-peer lending that provides financing for farmers for business development.

According to Bank BRI’s corporate secretary, Amam Sukriyanto, TaniGroup plays an important role in empowering farmers. Through the digital platform, farmers can sell directly to end users without having to use intermediaries, covering a wider group. “This is in line with BRI’s spirit to empower MSMEs, among which are farmers,” he said.

Previously, Bank BRI collaborated with TaniGroup in banking services, including online acquiring that facilitates transactions by using BRI Virtual accounts (BRIVA), e-pay BRI and credit cards. In line with the spirit of physical distancing, TaniGroup buyers/customers can enjoy BRI products to shop from home more easily, with a higher limit. To help manage finance, BRI provides TaniGroup with a Cash Management System (CMS).  

With various financial service support for TaniGroup, BRI expects the bank to take part in developing the agricultural sector, especially providing added-value for Indonesian farmers.

Bank BRI’s endeavors to support food security, in fact, started long before the outbreak of COVID-19 in Jakarta.

At the Dialog with the farmers in Lampung, Sunarso symbolically handed over KUR loans valued at Rp 50 million to two participating representatives. Apart from that, Yayasan Baitul Mal BRI (YBM BRI) symbolically donated Rp 1.6 billion to 31 farmer groups participating in the Peningkatan Keterampilan Usaha Rakyat (PKUR) program, especially engaged in the area of horticultural agriculture. 

“The pandemic has put incredible pressure on MSME players, including farmers. Therefore, apart from continually distributing KUR and relaxing the affected customers’ loans through various programs, Bank BRI continues to encourage MSMEs to survive and adapt to welcoming the new normal era,” Sunarso remarked. 

Following a dialog with the people, the entourage visited a rice mill owned by BRI and EDC-equipped Agen BRILink. Then, the entourage went down to the paddy field to have a direct talk with the farmers. In response to a request from one of the farmers whose agricultural business is disrupted every time the dry season comes, Sunarso donated a water pump under the bank’s environmental development-related CSR program.

Nationally, BRI has distributed more than Rp 47.4 trillion in KUR to more than 1.7 million SMEs, or equivalent to 39.35 percent of the government’s target.

“Despite the challenging conditions of today, BRI remains optimistic that by the end of this year, the company can achieve the target set by the government,” Sunarso said.

BRI continues to spur the growth of KUR nationally through a selective growth, focused on several production sectors that continually move, such as agriculture and health. On top of that, BRI has also conducted loan digitalization, enabling BRI marketing force to conduct their activities safely despite a call to apply health protocols and physical distancing measures.

“Currently we are preparing a new credit scheme for MSME players, with the objective of ensuring that soon after COVID-19 passes, they can revive and return to propel the wheel of the national economy,” Sunarso concluded.

For further information on Bank BRI, please visit www.bri.co.id.

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