Policy Reformulation for Rural Credit Banks in the Digital Era: A Qualitative Approach Based on Literature Review and Global Benchmarking (JURNAL TERAPAN MANAJEMEN DAN BISNIS)
Summary
- The total number of Rural Credit Banks (BPR) operating in Indonesia continuously decreased from 1,468 units in 2021 to 1,339 units in June 2025.p.2
- Under Law Number 4 of 2023 concerning the Development and Strengthening of the Financial Sector, Rural Credit Banks were formally renamed Bank Perekonomian Rakyat.p.2
- Despite serving remote communities and micro-enterprises, BPR assets account for under 2% of total national banking industry assets.p.5
- The proposed adaptive policy reformulation framework synthesizes five strategic dimensions: digital transformation, regulatory reform, governance and risk management, microfinance collaboration, and state support.p.3
- International policy benchmarking highlights successful microfinance digital transformation strategies implemented in developing countries like India and the Philippines.p.4
Key insights
- The continuous drop in active BPR units from 1,468 in 2021 down to 1,339 in June 2025 highlights severe structural pressures on rural community banks.p.2
- Although BPRs represent under 2% of total banking assets, they remain a vital pillar for expanding financial inclusion in underserved rural areas.p.5
- Internal institutional deficiencies, including reliance on traditional interest margin business models and low governance quality, increase bankruptcy risks for BPRs.p.5
- Implementing adaptive regulation, such as regulatory sandboxes and streamlined fintech partnership licensing, balances financial stability with technological innovation.p.6
- Adopting technology-driven risk management tools like credit scoring and real-time transaction monitoring is essential to improve operational safety.p.7
- Strategic cross-sector partnerships with BUMDes, cooperatives, and local fintech firms enable BPRs to offer relevant financial products to micro-enterprises.p.7
- Government support through digital subsidies and channeling People's Business Credit (KUR) through BPRs is necessary to maintain regional economic stability.p.7
Topics and entities
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