Triggered by a series of reductions in Bank Indonesia's benchmark interest rate (BI Rate), banks will slowly reduce their lending rates. When interest rates are low, the real sector is ready to take out investment loans or working capital loans for business expansion.
As stated by Chairman of the Indonesian Exporters Association (GPEI) Benny Soetrisno, the BI Rate reduction has a positive impact on the sustainability of the business world - especially those related to exports.
The BI Rate reduction is indeed strategic. In addition to lowering thecost of funds, the competitiveness of national export products has increased and encouraged the growth of the national export business. In turn, economic growth can accelerate even faster.
"The government has seen the development of economic conditions so that it reduces the BI Rate. I support this decision because it is very useful," said Benny when met at the SUAR.id Roundtable Discussion event at JS Luwansa Hotel, in Jakarta (18/9/2025).
As is known, the results of the September 2025 BI Board of Governors meeting, Wednesday (17/9/2025), BI lowered the benchmark interest rate by 25 basis points to 4.75%. Dus, throughout this year, BI has lowered the BI Rate five times. Namely, in January, May, July, August, September. Each reduction amounted to 25 basis points.
"With the BI rate at 4.75%, the cost of borrowed funds is cheaper, so it can encourage companies to increase their export activities," said Benny.
In line with Benny, Executive Director of the Indonesian Textile Association (API) Danang Girindrawardana said, one of the benefits of the BI Rate reduction that can be enjoyed by the business world is lower capital costs. Thus, business actors can encourage their business.
Moreover, the business world needs cheaper credit interest for investment loans and working capital. "More competitive interest rates can have an impact on production costs that can be more competitive as well. In the end, our production can be much more competitive," said Danang.
Bank Mandiri Corporate Secretary M Ashidiq Iswara said that his party views BI's move to reduce the BI Rate by 25 basis points to 4.75% as an accommodative monetary policy and in line with efforts to boost national economic growth.
The reduction in the benchmark interest rate for the fifth time this year is expected to strengthen liquidity transmission to the banking sector and the real economy, while maintaining inflation and exchange rate stability.
In line with this, Bank Mandiri is committed to supporting the acceleration of a healthy and measurable reduction in lending rates. "Especially in encouraging productive and strategic sectors oriented towards strengthening the competitiveness of the domestic economy in line with the government's Asta Cita," said Ashidiq, Thursday last week.
Bank Mandiri emphasized that the adjustment of lending rates on reference rate -based portfolios has been carried out in accordance with the downward trend in the BI Rate. Where, the effectiveness of transmission is influenced by industry liquidity, cost of funds structure, and communication strategy to customers.
"In adjusting lending and deposit rates, we always prioritize prudential principles by considering internal liquidity, market developments, and prevailing monetary policies," Ashidiq said.
Benefit consumers and businesses
Economic observer from the Institute for Development Economics and Finance (Indef) Eko Listiyanto agreed that the BI Rate cut by BI benefits consumers and businesses.
The impact for businesses is that with lower borrowing costs, companies and UMKM can obtain capital at lower interest costs. This allows them to expand and increase production.
The decline in the BI Rate also has an impact on consumers, as it can encourage purchasing power. Credit costs become more affordable for home or vehicle purchases. This can increase demand in these sectors, thereby boosting overall economic activity.
"People who have loans can feel a decrease in debt installments, which provides more space to allocate funds to other needs," Eko told SUAR in Jakarta (20/9/2025).
BCA Chief Economist David Sumual said that businesses - especially large corporations - have actually increased capital expenditure since the second and third quarters. Based on data from BCA's team of economists, the increase in corporate capital expenditure up to the beginning of September reached 11.25% YoY. That is, an increase compared to the second quarter of 4.40% YoY and the first quarter of 3.02% YoY.
"Naturally, these businesses must continue to expand to increase their domestic capacity. This is because Indonesia's population continues to grow. This must be fulfilled by business actors," said David.
Especially now that the BI Rate continues to fall, indicating that bank lending rates could fall as well - thus further stimulating real sector credit.
BI to spur real sector credit
BI Governor Perry Warjiyo said that BI's decision to lower the BI Rate, among other things, was aimed at spurring the real sector.
"Loose monetary policy also encourages an increase in money supply, and is expected to increase in line with the expansion of government fiscal policy to boost the real sector," Perry said.
According to Perry, bank credit growth needs to be encouraged to support economic growth. Bank credit in August 2025 has not been strong, although it increased from July 2025 by 7.03% YoY to 7.56% YoY in August 2025.
On the demand side, the lack of strong credit development was influenced by thewait-and-see attitude of business actors, high lending rates, and greater utilization of internal funds to finance their businesses.
