The government has officially established an electric vehicle subsidy in the form of a discount for the purchase of new or converted electric motors starting March 20, 2023. Related to this, Micro, Small and Medium Enterprises (MSMEs) are one of the priority recipients of the electric vehicle subsidy. According to the Head of the Fiscal Finance Agency of the Ministry of Finance (Kemenkeu), Febrio Kacaribu, MSME players are prioritized so that they can help their productivity in business. The government will subsidize a discount of Rp7 million for the purchase of a new electric motorcycle, with a quota of 200,000 units this year. Electric motors that receive subsidies are those that have met the requirements, namely having a Domestic Component Level (TKDN) of 40 percent. The government also provides the same amount of subsidy for the conversion of fossil-fueled motors to electric motors. For this type of subsidy, the quota is set at 50,000 units this year.
Requirements for MSMEs Receiving Electric Vehicle Subsidies
Although it is one of the priorities, not all MSMEs can get electric vehicle subsidies from this government. Minister of Finance Sri Mulyani explained that MSMEs that receive a Rp7 million discount subsidy for the purchase of electric motors are MSMEs receiving People’s Business Credit (KUR), recipients of micro business productive assistance or BPUM, Wage Subsidy Assistance (BSU), and recipients of 450 Volt Ampere (VA) to 900 VA electricity subsidies. As is known, KUR is a government program to increase access to financing for MSMEs channeled through financial institutions with a guarantee pattern. This program is intended to strengthen the ability of business capital in the context of policies to accelerate the development of the real sector and empower MSMEs. KUR MSME recipients can be individuals or business groups that conduct productive businesses. For MSMEs, there are two types of KUR provided by the government, namely:
- KUR Mikro: A type of loan for micro-scale businesses with a maximum loan size of Rp25 million. The repayment period is three years for working capital loans and five years for investment loans.
- KUR Retail: Aimed at medium-sized businesses with a maximum loan limit of Rp500 million. The loan period for working capital financing is four years and investment financing is five years.
How to apply for KUR for MSMEs
For MSME players who want to get KUR capital loans to further receive government subsidies, they need to first know the requirements and procedures for applying. The KUR application requirements for MSMEs include:
- Prospective borrowers are not currently receiving capital loans from banks or the government
- If you have previously borrowed and the data is still recorded in the BI Debtor Information System, you must repay it and attach a Certificate of Repayment (except for KUR Mikro).
- The business sectors prioritized for KUR are those in which the government prioritizes financing, such as agriculture, fisheries, processing industry, trade, and so on.
After meeting the criteria, MSME players can apply for KUR with the following procedures:
- Ensure that the proposed business is productive and prospective.
- Prepare complete submission documents including KTP, business establishment deed, NPWP, SIUP, financial statements, business proposals, etc.
- Go to the offices of the channeling banks listed by the government. Follow the existing procedures. Usually, the bank will conduct a survey or interview to analyze the borrower’s eligibility.
- Wait for the results of the announcement from the channeling bank whether the application is disbursed or not
It turns out that to get an electric vehicle subsidy, MSMEs only need to register themselves in the KUR program, easy enough right? So, are your MSMEs also interested in getting electric vehicle subsidies from the government? Hopefully this subsidy policy will be implemented in the near future and can increase the effectiveness and efficiency of MSME players, yes!
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The key is that the required documents such as the identity of the MSME actor and business legality must be fulfilled so that the KUR application process and all access to other government assistance funds can run smoothly and the application is guaranteed to be approved.
KH Contact
To help with the process of obtaining business legality documents that facilitate MSME access to government assistance, KH Pals can immediately contact Kontrak Hukum. With us, KH Pals can consult about business and other needs, including completing all business legality documents needed for submission to government programs. The business legality documents include business licenses, NPWP, NIB, to the establishment of business entities. To see which services suit your needs, please visit the KH Services – Starting a Business page. If you have other questions, don’t hesitate to consult with us at Ask KH or via Direct Message (DM) to Instagram @kontrakhukum.
