Policy Brief 05 – High Interest Rate Regime and Pro-Poverty Monetary Policy

IMPORTANT POINT:

1. The high interest rate regime has had an impact on the MSME sector's low access to bank financing, while this sector is the main pillar of the economic activities of low-income communities in Indonesia.
2. The oligopoly market structure, cartel practices and the influence of large capital forces in the banking world have led to a policy of high interest rates.
3. Pro-poverty monetary policy efforts are needed by lowering lending rates for MSMEs and expanding access to credit for MSMEs, and financial inclusion that expands banking services for low-income people.