Characteristic of Borrowers in Agribusiness Microfinance Institution Formed by the PUAP Program in Kendal Regency, Central Java-Indonesia

Research Center for Behavioral and Circular Economics, National Research and Innovation Agency, Jakarta, Indonesia

^* Corresponding author: rangkayoamah@gmail.com

Abstract

Rural Agribusiness Development gives a 100 million business fund activity to a selected farmer group association. An Agribusiness Microfinance Institution is expected to manage the fund by providing a loan to its members. The priority of business is focused on the agricultural sector. However, in its development, an Agribusiness Microfinance Institution provides loans to the agricultural and non-agricultural sectors. The study’s objective is to observe the characteristic of Agribusiness Microfinance Institution’s borrower in Kendal Regency, Central Java-Indonesia. Kendal Regency was selected as the survey area because a result study in 2019 showed that Kendal Regency is one area with 5 LKMAs good performance in Indonesia. The study was conducted on November 2022. Forty-nine respondents were selected purposively in the survey. The criteria of respondents were borrowing from LKMA from 2019 to 2022. Data were analyzed descriptively using SPSS. The results showed that the average respondent: age was 50 years old, getting an education for nine years, 34,7% worked as a farmer and trader, the loan amount was 5.4 million IDR, loan duration was 9.2 months, and the rate of interest per month was 1.47%. The primary respondents’ reason for borrowing from LKMA was the loan amount, interest rate, fast disbursement and ease of requirements.