Mandiri to lend $20.79M to oil palm cooperatives

Bank Mandiri will disburse loans to cooperatives of oil palm farmers to boost the amount of credit disbursed to SMEs this year.

Mandiri agreed to lend a total of US$20.79 million or Rp 189 billion to four cooperatives fostered by the Sinar Mas Group, one of Indonesia’s major palm oil producers.

The four cooperatives are: Kopsa Puyang Gana, which will receive Rp 56.8 billion to work 1,024 hectares of land in West Kalimantan; Kopsa Mitra Bintang Moda, which has secured 59.49 billion to work 1,062 hectares of land in West Kalimantan; Kopsa Mitra Cipta Sejahtera with Rp 51.88 billion to work 936 hectares of land in West Kalimantan; and Kopsa Reantakam with Rp 21.08 billion to work 400 hectares in South Kalimantan.

A total of more than 1,700 farmers will be covered by the credits.

Mandiri’s commercial and business banking director, Sunarso, said the company has set interest rates at around 11 percent. The loans will mature in five years.

“However, the farmers will only bear 7 percent, while the remainder will be subsidized by the government. The 7 percent interest rates are also capitalized in total loans,” Sunarso said.

Mandiri disbursed Rp 30.2 trillion or $3.32 billion in credit to SME’s from a total lending of around Rp 380 trillion last year.

“We are targeting credit for SMEs to reach Rp 40 trillion this year and hope to have a portfolio of Rp 73 trillion of lending to SMEs in 2014,” Sunarso said on Wednesday.

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