OJK Launches Roadmap For Microfinance Institution Development Until 2028

OJK Launches Roadmap For Microfinance Institution Development Until 2028

Monday, 25 Nov 2024

The Financial Services Authority (OJK) has unveiled the Roadmap for the Development and Strengthening of Microfinance Institutions (MFIs) for the period 2024-2028 in Jakarta on Monday, November 25, 2024. Agusman, a member of the OJK Board of Commissioners, stated that the roadmap is structured into three phases of implementation, commencing in 2024 and concluding in 2028. The first phase focuses on strengthening foundations and consolidation from 2024 to 2025, which Agusman emphasized must be executed thoroughly.

"In the second phase, we aim to create momentum. We require momentum that will significantly enhance our efforts in 2026 and 2027," Agusman remarked. "By 2028, in the third phase, we anticipate continued growth, indicating that MFIs will have the necessary consumer base. This initiative will persist into the future to ensure the continued success of MFIs," he added. Agusman further noted that the roadmap envisions establishing MFIs as robust and trustworthy financial institutions within the micro segment.

Additionally, MFIs aspire to contribute to community empowerment and consumer protection. Therefore, the roadmap launched on Monday is intended to serve as a guide for various stakeholders within the MFI industry. Agusman explained that the roadmap is founded on four main pillars: governance, empowerment, education and literacy, strengthening the environmental system, and regulatory oversight and licensing.

The OJK has indicated that it remains open to the possibility of overseeing and evaluating the existing roadmap, suggesting that revisions may occur if deemed necessary. Meanwhile, OJK Chairman Mahendra Siregar stated that the Roadmap for the Development and Strengthening of Microfinance Institutions (LKM) for 2024-2028 is the fourth roadmap introduced by the OJK.

Prior to this, the OJK had already launched roadmaps for financing institutions, venture capital, and peer-to-peer lending (P2P). He expressed hope that the roadmap would enhance the currently established ecosystem of LKM. "This is the fourth LKM. The regulations are clear, the platform is defined, and now the roadmap has been established, which means the process of strengthening with specific targets is now complete, forming a cohesive ecosystem," Mahendra said. (reza@insightinnews.com)

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