Kredit Usaha Rakyat

Comprehensive Guide to People’s Business Credit (KUR) for Small Entrepreneurs

People’s Business Credit (KUR) is a government program that has been a lifeline for many small entrepreneurs in Indonesia. This program provides an opportunity for those with small businesses to access affordable financing.

This article will delve into KUR extensively, from its basic concepts to its benefits for small entrepreneurs. We will explore relevant and crucial aspects of this program and how it helps drive the national economy.

What is People’s Business Credit (KUR)?

People's Business Credit

People’s Business Credit (KUR) is a credit program organized by the Indonesian government to assist small and micro-entrepreneurs in developing their businesses. The primary goal of this program is to improve access to financing for business segments that often struggle to obtain loans from conventional financial institutions.

The KUR program offers various types of loans designed to meet diverse financing needs, from working capital to business expansion. One of the program’s main advantages is its low-interest rates, making it more affordable compared to loans from private financial institutions.

How Does People’s Business Credit (KUR) Work?

Government Regulation

People’s Business Credit is regulated and managed by Bank Indonesia and the Ministry of Finance. The Indonesian government plays a central role in this program to ensure that small and micro-entrepreneurs have better access to financing.

Bank as Intermediary

Although this is a government program, the disbursement of KUR loans is done through banks that collaborate with the government. These banks act as intermediaries between the government and the borrowers, responsible for evaluating and disbursing loans to borrowers.

Loan Application Process

The People’s Business Credit loan application process consists of several stages:

Loan Application

Small entrepreneurs who meet the criteria can apply for KUR loans to banks designated by the government. These entrepreneurs must submit a business plan and other supporting documents.

Evaluation and Approval

The bank will evaluate the business plan and assess the loan’s feasibility. If the requirements are met, the bank will approve the loan.

Loan Disbursement

After approval, the loan funds will be disbursed to the borrower. Borrowers can use the funds according to their business plan.

Loan Repayment

Borrowers must repay the loan according to the agreed-upon payment schedule. The low-interest rates make repayments more affordable.

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Types of People’s Business Credit (KUR)

The People’s Business Credit program offers various types of loans that can be tailored to the needs of small entrepreneurs. Here are some common types of KUR:

Micro People’s Business Credit

This is the simplest type of loan suitable for small entrepreneurs who need limited working capital. It is a suitable option for those starting their businesses.

Retail People’s Business Credit

Retail People’s Business Credit is more suitable for businesses in the retail sector, such as grocery stores or eateries. This loan can be used to expand inventory or improve retail facilities.

Production People’s Business Credit

Specifically designed for businesses focusing on the production of goods or services, this loan supports small entrepreneurs in enhancing their production and product quality.

Agricultural People’s Business Credit

Entrepreneurs in the agricultural sector can utilize Agricultural People’s Business Credit to finance their businesses. This includes funding for purchasing agricultural equipment, seeds, and fertilizers.

Tourism People’s Business Credit

For those involved in the tourism business, Tourism People’s Business Credit can provide essential financing to improve and develop their tourism ventures.

Benefits of People’s Business Credit Program

People's Business Credit

Low-Interest Rates

One of the main advantages of the KUR program is the low-interest rates. These low-interest rates make loan repayments more affordable for small entrepreneurs, allowing them to focus more on business development than paying high-interest rates.

Access to Financing

KUR opens doors for small entrepreneurs who may have limited access to traditional financing. The program helps overcome the financial constraints often faced by small and micro-entrepreneurs, enabling them to realize their full business potential.

Business Development

With funds from KUR, small entrepreneurs can expand their businesses. This includes purchasing new equipment, increasing inventory, improving infrastructure, or even venturing into new markets. With these additional resources, entrepreneurs can enhance their production capacity and services.


The KUR program often accompanies loans with mentoring programs. This could include financial management training, business consultations, or guidance in business planning. This mentoring helps borrowers manage their businesses more efficiently and effectively.

Requirements for Obtaining People’s Business Credit

People's Business Credit

Micro or Small Business

A primary requirement for obtaining KUR is to have a business that meets the definition of micro or small according to government standards. This ensures that the program genuinely reaches small and micro-entrepreneurs.

Indonesian Citizen

The KUR program is only available to Indonesian citizens. This is a step to ensure that the benefits of this program are given to those contributing to the Indonesian economy.

Good Financial Track Record

Borrowers must have a good financial track record. They must be able to prove their ability to repay the loan. This includes financial statements, income proof, and credit history if available.

Business Plan

Borrowers must prepare a detailed and convincing business plan to support their KUR loan application. This business plan should include goals, strategies, and income and expenditure estimates.


Some types of KUR loans may require collateral, such as land certificates or motor vehicles. This collateral is used as security to ensure that the loan will be repaid according to the terms.

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The People’s Business Credit program is a crucial tool in supporting small and micro-entrepreneurs in Indonesia. It provides access to affordable financing, helps economic growth, creates job opportunities, and reduces poverty.

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