The Impact of Macroprudential Policies on MSME Credit Growth and Risk

Ferry Fredrick Kaban; Dewi Hanggraeni

doi:10.38035/dijemss.v5i3.2375

Authors

Ferry Fredrick Kaban Universitas Indonesia
Dewi Hanggraeni Universitas Indonesia

DOI:

https://doi.org/10.38035/dijemss.v5i3.2375

Keywords:

Conventional Banks, Credit Risk, Loan Growth, Macroprudential Policy, MSME

Abstract

The aim of this research is to identify the impact of macroprudential policy related to the financing ratio for micro small medium enterprises (MSME) to each bank’s MSME credit growth and non-performing loan (NPL). This research used a panel data analysis using the pooled least square (PLS) model conducted on the financial data of 40 public conventional banks for the observation during the period from 2012 to 2021 with MSME’s credit growth and NPL as the dependant variables and the policy, bank’s characteristics, and macroeconomic factors as independent variables. The results reveals that the policy significantly affects MSME’s credit growth and NPL. This study ultimately provides input for banks to fulfill the financing ratio in order to comply with the regulator but should be selective in terms of MSME’s financing. The findings of this research inquire regulator to re-evaluate the requirement target for all banks to achieve minimum financing MSME ratio.

References

Altunbas, Y., Binici, M., & Gambacorta, L. (2018). Macroprudential policy and bank risk. Journal of International Money and Finance, 81, 203–220.

Andrie?, A. M., Melnic, F., & Sprincean, N. (2022). The effects of macroprudential policies on credit growth. The European Journal of Finance, 28(10), 964–996.

ANISA, A., & SUTRISNO, S. (2020). Capital buffer and determinant factors of conventional banks in Indonesia. The Journal of Asian Finance, Economics and Business (JAFEB), 7(12), 377–384.

Aslamah, A.N. & Pratama, A. (2022). Pengaruh Instrumen Kebijakan Makroprudensial Terhadap Pertumbuhan Kredit Bank Umum di Indonesia. Jurnal Pendidikan Ekonomi, Perkantoran dan Akuntansi, 2302-2663.

Bappenas. (2020). Kajian Kebijakan Penanggulangan Dampak Covid-19 terhadap UMKM – Survei Kebutuhan Pemulihan Usaha Bagi UMKM Indonesia.

Beck, T., & Demirguc-Kunt, A. (2006). Small and medium-size enterprises: Access to finance as a growth constraint. Journal of Banking & Finance, 30(11), 2931–2943.

Behncke, S. (2023). Effects of macroprudential policies on bank lending and credit risks. Journal of Financial Services Research, 63(2), 175–199.

?ehaji?, A., & Košak, M. (2021). Tightening and Loosening of Macroprudential Policy, Its Effects on Credit Growth and Implications for the COVID-19 Crisis. Economic and Business Review, 23(4), 207–233.

?ehaji?, A., & Košak, M. (2022). Bank lending and small and medium-sized enterprises’ access to finance–Effects of macroprudential policies. Journal of International Money and Finance, 124, 102612.

Claessens, S., Ghosh, S. R., & Mihet, R. (2013). Macro-prudential policies to mitigate financial system vulnerabilities. Journal of International Money and Finance, 39, 153–185.

Fakhrunnas, F., Nugrohowati, R. N. I., Haron, R., & Anto, M. B. H. (2022). The determinants of non-performing loans in the indonesian banking industry: an asymmetric approach before and during the pandemic crisis. SAGE Open, 12(2), 21582440221102420.

Foos, D., Norden, L., & Weber, M. (2010). Loan growth and riskiness of banks. Journal of Banking & Finance, 34(12), 2929–2940.

Gaganis, C., Hasan, I., & Pasiouras, F. (2013). Efficiency and stock returns: evidence from the insurance industry. Journal of Productivity Analysis, 40, 429–442.

Gómez, E., Murcia, A., Lizarazo, A., & Mendoza, J. C. (2020). Evaluating the impact of macroprudential policies on credit growth in Colombia. Journal of Financial Intermediation, 42, 100843.

Haryati, S. (2009). Pertumbuhan kredit perbankan di Indonesia: Intermediasi dan pengaruh variabel makro ekonomi. Jurnal Keuangan Dan Perbankan, 13(2), 299–310.

Kim, H., & Bachman, J. R. (2019). Examining customer perceptions of restaurant restroom cleanliness and their impact on satisfaction and intent to return. Journal of Foodservice Business Research, 22(2), 191–208. https://doi.org/10.1080/15378020.2019.1596002

Meuleman, E., & Vander Vennet, R. (2020). Macroprudential policy and bank systemic risk. Journal of Financial Stability, 47, 100724.

Pasaribu, F. M. B. (2021). Pengaruh Kualitas Produk, Harga, Dan Brand Image Terhadap Minat Beli Produk Pada Emina. STIE YKPN.

Tarigan, Z. N. A. B., Dewi, F. N., & Pribadi, Y. (2022). Keberlangsungan Usaha Mikro, Kecil, Dan Menengah Di Masa Pandemi: Dukungan Kebijakan Pemerintah. Jurnal BPPK: Badan Pendidikan Dan Pelatihan Keuangan, 15(1), 12–23.

Wardhani, I. D. (2012). Analisis Risiko Pembiayaan Kredit Korporasi Bank Asing di Indonesia (Studi Kasus Bank ABC).