Govt Encourages Banks to Assist Indonesian Migrant Workers

 
Robert Sidauruk, Fathan Qorib
 
Represented by the National Agency for Indonesian Worker Placement and Protection (BNP2TKI), the government is encouraging banks to be more active in providing loans to prospective Indonesian migrant workers through the Microcredit Scheme (KUR). A memorandum of understanding on this specific matter was already signed in 2010 and is not something new for banks.
 
Nusron Wahid, Head of BNP2TKI, contends that Indonesian workers wishing to be employed overseas as domestic workers must first pay a number of costs and fees as part of their placement and departure services from their agency. It is hoped that the KUR loans from banks can assist Indonesian migrant workers with these costs.
 
“The KUR will be used to settle costs and fees for the placement of departing workers,”said Mr. Wahid in Jakarta on Monday.
 
Mr. Wahid further explained that placement and departure cost are a serious burden for migrant workers. As an example, a worker who wishes to work in Taiwan must pay at least IDR 51 million for his/her placement and departure services alone.
 
The IDR 51 million covers the passport fee, air flights, competency tests and insurance which can be as much as IDR 17 million. There are also additional costs of IDR 34 million to cover the agent’s fee, medical check, and accommodation in the destination country.
 
“In total, a worker is required to pay costs of 10 – 11 times his/her salary just to get to Taiwan,”said Mr. Wahid.
 
To cover these costs, Indonesian migrant workers are usually left with no option than totake credit facilities from non-bank institutions. The interest rate on such loans can reach 30% flat for a year. Given these circumstances, it is hoped that KUR loans can provide an alternative solution for migrant workers to access credit at low interest rates.
 
Loan Sharks
Imam el Ghazali, Director for Research and Advocacy at Nusantara Center of Study (Pustara), believes that the government must prioritize the protection of Indonesian migrant workers from extortion and loan sharks.
 
Moreover, Mr. Ghazali said that BNP2TKI must also eliminate credit provided by cooperatives to prospective migrant workers which is made at extremely high interest rates.These cooperatives are taking unfair advantage of migrant workers as the workers usually find it difficult to access credit at a competitive interest rate and with simple procedures.
 
“This is a crime. The government must eradicate high interest loans that are provided by cooperatives to prospective Indonesian migrant workers,” concluded Mr. Ghazali.
 
(hot/kc)