My WordPress Blog Uncategorized Rising Credit Interest, Slow Entrepreneur Expansion, More Competitive P2P Lending

Rising Credit Interest, Slow Entrepreneur Expansion, More Competitive P2P Lending

After Bank Indonesia (BI) decided to raise the benchmark interest rate or BI-7RR Reverse Repo Rate (BI-7DRR) by 25 basis points to 5.75 percent, a number of businessmen in the banking sector were preparing to raise their lending rates.

This condition is considered unprofitable for entrepreneurs, the public and the government. For this reason, according to Hariyadi, one of the steps in anticipation is that employers must carefully manage operational aspects efficiently.

On the other hand, this situation brings concern to the decline in people’s purchasing power. The solution, said Hariyadi, entrepreneurs must secure the domestic market.

According to him, entrepreneurs and the government must increase value added production so that the economy is able to survive in this situation.

He continued, the important point in the spotlight was that the government should not panic, entrepreneurs also need to face the current situation. As is known, the increase in bank lending rates so far is still acceptable.


Increase Credit Interest

Increase Credit Interest

The Economist Institute for Development of Economics and Finance (Indef) George Optisema said a number of banks had raised interest rates by 25-50 bps.

According to him, the base points were considered quite moderate amidst a slowdown in household consumption.

Bhima said business expansion could be disrupted if it increases aggressive interest rates. He also believes, if not careful, the non-performing loan (NPL) or problem loans will increase:

“If it happens, then the bank loses its own. For this reason, banks usually prefer to cut net interest margin compared to raising credit interest. “That’s the trade off .”

President Director of Rose Bank or BCA Tiaya Santisima has raised twice the loan interest rate this year. The first increase was made in August. Then, interest rates rose again after the increase in the benchmark interest rate or BI 7-DRR.

“We have indeed raised 25 bps because the Fed raised interest rates by 25 bps. But apparently the exchange rate (dollar) is still increasing. So it should be increased if 50 bps is safer. “

Tiaya views, to be safer, credit interest rates should increase by 50 bps. However, if the decision is taken, it will affect the business world. The reason is, if the bank raises interest rates too high, then the growth of the business world will increasingly stagnate. Seeing these risks, finally the increase in interest rates was pressed slowly.

Usually, he said, the increase is usually followed by an increase in deposit rates and then transmitted to an increase in lending rates:

BNI Treasury and International Director Ondoy Rizal said that the interest of BNI Credit with floating or reference rate interest rates has automatically adjusted to the increase in market interest such as the JIBOR (Jakarta Interbank Offered Rate) or London Interbank Offered Rate (LIBOR).

Both use a floating rate , which is the amount of change in the interest rate adjusted for a certain period of time.


Competitive P2P Lending

borrow money

Quoted from Kontan Newspaper, Monday (10/08/2018), related to the increase in bank loan interest rates ranging from 25 bps to 100 bps, Amseleran Chief Credit Officer & Co-Founder Chris Gutom said that it had not had a significant influence on P2P Lending activities.

In fact, many finteches have not made adjustments to interest rates, including Amseleran.

He continued, the interest rates at P2P lending were still higher compared to bank interest rates, which were 12 percent to 14 percent per year before the BI-7DRR rose by 25 bps in May.

In comparison, the average interest rate in Acceleration is 18 percent to 21 percent per year for debtors.

What is your response after reading the news about the effect of the increase in benchmark interest rates and loan interest rates? Give your opinion in the comments column below.

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