Bank Indonesia Boosts Credit Growth with Rp423 Trillion Incentive Program

Enhanced Macroprudential Policy for 2026

Bank Indonesia (BI) has announced plans to continue its loose macroprudential policy through 2026, with the ambitious target of achieving credit growth between 8% to 12% in the coming year. To facilitate this growth, BI will implement a significant incentive program worth Rp423 trillion, effective starting December 2025.

Key Features of the Incentive Program

The incentive scheme is designed to encourage banks to lower their interest rates more rapidly. According to BI Governor Perry Warjiyo, banks that demonstrate quicker reductions in their lending rates will receive macroprudential liquidity incentives. This strategic move is part of BI's broader effort to stimulate economic activity through increased credit availability.

Policy Rationale and Implementation

The decision was announced during the Bank Indonesia Annual Meeting (Pertemuan Tahunan Bank Indonesia - PTBI) on November 28, 2025, in the presence of President Prabowo Subianto. Warjiyo emphasized that the macroprudential liquidity incentives will be focused on promoting credit growth in strategic government sectors. The immediate implementation in December 2025 marks an acceleration of the incentive program.

Broader Financial Stability Initiatives

In addition to the credit growth initiatives, BI, as part of the Financial System Stability Committee (KSSK), will work closely with other financial regulators including the Ministry of Finance, Financial Services Authority (OJK), and Deposit Insurance Corporation (LPS) to enhance surveillance of the financial system and maintain stability. This coordinated approach aims to both stimulate credit growth and ensure the overall stability of the financial system.

Market Impact and Expectations

The introduction of such a substantial incentive program is expected to have a positive impact on lending activities in the banking sector. By providing financial incentives for banks to lower their interest rates, BI aims to make credit more accessible and affordable for businesses and consumers, potentially boosting economic activity in the short to medium term.