Jakarta, Indonesia Sentinel — President Prabowo Subianto has reaffirmed his commitment to erase long-standing debts that have weighed heavily on the nation’s low-income communities particularly small-scale farmers. He stated that banks continue to pursue repayments on decades-old debts that should have been written off.
The commitment was announced during plenary cabinet meeting to mark six months of his administration, held at the Presidential Palace in Jakarta on Monday (May 5).
“It was an old issues from decades ago, small people’s debts that should have been cleared by the banks are still being collected,” Prabowo said. “Millions of our farmers, millions of our working-class citizens, are unable to secure new loans.”
The president warned that unresolved legacy debts have trapped vulnerable communities including farmers in a vicious cycle, shutting them out of the formal credit system and forcing them to turn to predatory lenders or high-interest online loan platforms.
“They’re left with no choice but to borrow from loan sharks or online lenders with outrageous daily interest rates,” Prabowo said. “We will erase those debts and take the necessary actions, even if they involve risks.”
He emphasized that the government will implement the debt cancellation program carefully and with fiscal discipline, ensuring it stays within the framework of state budget control.
Read Also:
Rice Stockpile Surge, President Prabowo Orders Construction of Emergency Warehouses
The announcement builds on a previous debt relief policy signed into law in 2024 under Government Regulation No. 47. That initiative aimed to wipe out approximately Rp10 trillion ($640 million) in debt owed by one million farmers, fishermen, livestock breeders, and small business owners impacted by the COVID-19 pandemic and natural disasters.
Minister for Small and Medium Enterprises Maman Abdurrahman stated that the debt write-off applies only to individuals who are no longer able to repay and whose debts have been outstanding for more than ten years.
President Prabowo expressed hope that the policy will boost agricultural and fisheries production, strengthening the country’s food security and supporting the livelihoods of millions of Indonesians.
(Raidi/Agung)
