ASIA: Indonesia's Bank Mandiri is aiming to grow its commercial lending

Indonesia’s state-owned Bank Mandiri is aiming to grow its commercial lending sector to support micro-businesses in the country. The bank has seen continuous growth of 20% annually since 2014 and aims to reach a growth of 28% to IDR 65 trillion (USD 5 billion) by end of this year. Currently Bank Mandiri’s micro-lending accounts for 17% of Indonesia’s overall lending portfolio.

According to the bank’s data, micro lending distribution reaches nearly 18% growth across all industries, with agriculture, fisheries, and mining as the most productive ones. These sectors make over half of the bank’s portfolio. In order to reach the target of 28% growth by end of this year, the bank will be adding the number of micro unit branches across Indonesia to help distribute the loans.

According to RFi Group data from SME Banking Council, 35% of micro SME in Indonesia (small businesses with annual revenue lower than USD25,000) is looking to take up loan in the next 12 months. Bank Mandiri’s plan to grow its loan sector will likely be able to answer micro businesses in the market.

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