Prosperous Micro-, Small- and Medium-Sized Enterprises (MSMEs) Thanks to Rural Banks (BPR) in Sidoarjo Regency
8 Pages Posted: 18 Nov 2019
Date Written: August 29, 2019
Micro-, small- and medium-sized enterprises (MSMEs) are among the main drivers of economic growth. When the economic crisis hit in 1997, only MSMEs could survive. In addition to being economic drivers, MSMEs are capable of employment and providing a significant contribution to the Gross Domestic Product (GDP).
The purpose of the present study was to analyze the role of rural banks (BPR) on MSMEs in Sidoarjo Regency, East Java. This study was a qualitative descriptive one. A total of 26 informants from 11 Book I BPR in Sidoarjo was interviewed.
Results showed that the loans disbursed by BPRs greatly supported the improvement in the living standards of MSMEs. Of the 26 informants, all of them experienced an increase in both company profits and employment. Initially, there were those with no employee but, with the development of the business, they were capable of employment and some even increased the number of their employees. The loans disbursed by BPR had a significant role in the progress of MSMEs as evidenced by the improvement in their living standards. The Government is recommended to pay more attention to BPR by making policies that enable BPR to survive in the face of competition, especially with commercial banks.
Keywords: Loans; micro-, small- and medium-sized enterprises; rural banks (BPR)
Suggested Citation: Suggested Citation