OJK, Bank NTT and ILO launch financial literacy programme through EKI Village and Independent Credit programmes in East Sumba

EAST SUMBA, East Nusa Tenggara, Indonesia (ILO News) – The Indonesia Financial Services Authority (OJK) of East Nusa Tenggara (NTT) Province and the ILO launched and declared Kaliuda Village, Pahunga Lodu District, East Sumba Regency, as a pilot village for the implementation of the Financial Inclusion Ecosystem Programme (EKI) in NTT. The launch event was held on Wednesday, 28 May at the Kaliuda Village Hall and officiated by Umbu Ngadu Ndamu, Regional Secretary of East Sumba, representing the Regent of East Sumba, Drs. Khristofel Praing, M. Si.

Through the EKI programme, Kaliuda Village would be provided with various financial activities such as financial education and literacy programmes, access to business capital and investment. The EKI programme was initiated by OJK in collaboration with the Regional Financial Access Acceleration Team (TPAKD) and the Ministry of Villages, Development of Disadvantaged Regions and Transmigration.

Deputy Head of the NTT’s OJK Office, Polantoro, emphasized that the EKI programme aims to improve the society’s welfare and quality of life and to tackle poverty in rural areas. “Villages are one of the strategic development areas. However, people’s understanding about and the use of financial literacy products in rural areas are still relatively behind. "Therefore, the EKI programme, which involves various relevant stakeholders, seeks to increase the use of inclusive financial products in rural areas as part of sustainable national development," said Polantoro in his remarks.

© Gita Lingga/ILO

This launch event also marked the symbolic handover of the Independent Credit from Bank NTT to 20 seaweed farmers amounting to Rp. 5 million per person with zero percent interest and no collateral. The Seaweed cultivation has become one of the main community’s economic pillars in East Sumba Regency, including Kaliuda Village which is also known as a Seaweed Cultivation Village. Better understanding about finance and business is expected to further boost the local economy and the community’s level of life.

"One of Bank NTT's missions is to explore the potential of regional sources to become more productive by channelling funds in the form of micro credit with an interest rate of 0 percent for the welfare of the society. "We hope that this collaboration can be enhanced in order to improve financial services for seaweed farmers," said Stefanus Ngongo Mesa, SP, Head of Bank NTT Waingapu Branch, East Sumba.

The farmers receiving the micro credit are the beneficiaries of the ILO through its Promoting Micro and Small Enterprises through Entrepreneurial Access to Financial Services Project (Promise II Impact). Funded by the Swiss State Secretariat for the Economy (SECO), the ILO’s Promise II Impact programme is implemented in collaboration with OJK, regional development banks (BPD) and rural banks (BPR).

The ILO's Promise II Impact has provided financial and entrepreneurship education training programmes for 200 seaweed farmers. Based on their business development performance, 80 farmers had passed the initial selection to receive business assistances for eight months. Out of these 80 farmers, 20 farmers were selected to receive the micro credit assistance after they successfully passed the OJK's Financial Information Services System (SLIK) and were declared having a good credit history.

Djauhari Sitorus, ILO’s Promise II Impact Programme Manager, greatly welcomed the effort to support financial literacy at the village level and the selection of Kaliuda Village as an EKI village. "The Promise II Impact programme seeks to strengthen the seaweed value chain through financial literacy trainings and the use of digital platforms which are expected to further strengthen community’s financial access and literacy. This is also expected to further increase the use of financial products, not only from banking, but also from various financial institutions such as insurance and pension funds," said Djauhari.    

"The Swiss government is committed to supporting the development of SMEs in Indonesia which is in line with the priorities of the regional governments to promote sustainable economy and financial literacy. Financial access and digitalization are effective tools for improving people's welfare and quality of life through various programmes implemented by the Promise program II Impact in collaboration with relevant stakeholders," said Violette Ruppanner, Head of Economic Cooperation and Development, Swiss Embassy in Indonesia in her speech.

The launch of the EKI village is the second launch for the ILO-assisted villages. Previously, the OJK and ILO had launched the implementation of an EKI village in Umong Seuribee Village, Lhoong District, Aceh Besar Regency for the patchouli oil commodity.

For more information, please contact:
Yanis Saputra   
ILO’s Project Officer for Promise II Impact Project in Indonesia 
yanis@ilo.org

Gita F. Lingga  
Senior Communications and Information Management Assistant
gita@ilo.org