Ilona Estherina, Jakarta – Indonesian Finance Minister Sri Mulyani Indrawati has inked new order to support the funding of the Red and White Village Cooperatives. The government will inject Rp16 trillion into several state-owned banks to assist the loan distribution for these cooperatives.
The government will use the accumulated budget surplus (SAL) to achieve this.
The policy is outlined in the Minister of Finance Regulation (PMK) 63 of 2025 on the use of SAL of fiscal year 2025 for banks supporting the Red and White Village Cooperatives, enforced starting September 1, 2025.
According to Article 2 of the regulation, a funding synergy between the government and banks is necessary to finance the Red and White Cooperatives.
To support the banking sector, the government leverages SAL to inject funds into state-owned banks. "The amount of SAL utilization as referred to in paragraph (2) is Rp16 trillion," as stipulated in Article 2, paragraph 3 of the PMK.
The use of SAL from the state general cash account or RKUN for fund placements in banks is recorded as non-permanent government investment. It will be reported in the central government's financial statements for the 2025 fiscal year.
Previously, Sri Mulyani said that the government allocated additional funding for the Red and White Village Cooperative program amounting to Rp83 trillion. Despite the decrease in village fund allocation, this injection will replace it.
In the State Budget bill for 2026, the government has earmarked Rp60.6 trillion for village funds, a drop from Rp71 trillion this year. "Combined, the village fund of Rp60.6 trillion and Rp83 trillion for Red and White Village Cooperatives results in a bigger amount compared to last year's village fund of Rp70 trillion," said Sri Mulyani in a meeting with the Regional Representative Council (DPD RI) on Tuesday, September 2, 2025.
– Nandito Putra contributed to the writing of this article.