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BRG Monthly Insights - July 2023
The Role of Ultra Micro Holding (UMi)
The July 2023 edition of BRG Monthly Insights focuses on the critical role of Ultra Micro Holding (UMi), consisting of Bank BRI, Pegadaian, and PNM, in supporting micro and ultra-micro enterprises in Indonesia. The holding was formed to address significant barriers faced by these businesses, particularly limited access to funding.
Financial Growth and Performance
In 2022, UMi Holding recorded impressive growth, with total assets reaching IDR 1,866 trillion, marking an 11% increase compared to 2021. This strong financial growth is primarily attributed to the performance of Bank BRI, which forms the majority of the holding's assets.
Revenue and Profitability
In 2022, Ultra Micro Holding achieved significant growth in revenue, which increased from IDR 150 trillion in 2021 to IDR 166 trillion. Net profit almost doubled, rising from IDR 30.8 trillion in 2021 to IDR 51.4 trillion in 2022. This strong profitability was driven by improved loan portfolio performance, operational efficiencies, and successful digital service expansion.
Government Support and Initiatives
The Indonesian government actively supports the Micro, Small, and Medium Enterprises (MSME) sector through initiatives such as interest subsidies and special loan schemes, notably Kredit Usaha Rakyat (KUR). These policies and financial supports aim to mitigate challenges faced by MSMEs, particularly in funding access and business development.
Digitalization and Service Integration
Ultra Micro Holding continues to advance its digitalization strategy and integration of services through initiatives like the co-location service points named SenyuM, combining BRI, Pegadaian, and PNM services. The introduction of digital platforms, such as BRISPOT and the expansive AgenBRILink network, further enhances service delivery, efficiency, and broadens financial inclusion for micro-enterprises.
Commitment to ESG Principles
UMi Holding places a strong emphasis on Environmental, Social, and Governance (ESG) principles. The holding has undertaken significant initiatives such as issuing Green Bonds and increasing sustainable financing, which as of 2023, comprises approximately 66.7% of Bank BRI's total financing portfolio. This highlights the commitment of the holding towards sustainable financing and environmental stewardship.
Human Resource Development
Human resource development remains a strategic focus for Ultra Micro Holding. Intensive employee training and digital learning initiatives, such as BRISMART, are consistently implemented to enhance workforce competencies. These initiatives ensure the holding's human resources are well-prepared and capable of sustaining organizational growth and operational excellence.