Академический Документы
Профессиональный Документы
Культура Документы
By
Teddy Lesmana
Economic Research Center
The Indonesian Institute of Sciences
ABSTRACT
Indonesia, the largest Moslem country in the world, is still facing chronic poverty
problems. Despite the fact that GDP per capita has shown a positive trend since the
financial crisis that hit Indonesia in mid 1997, it is not difficult to see that poverty
and inequality still prevail in reality. There is widening gao between those who
control main business and the poor.. According to the Indonesia Central Bureau
of Statistics, around 17.75 percent of total population (around 220 millions)
are still living under poverty line. The poor themselves have underutilized
entrepreneurship potential due to the structural barriers in economic activities.
Microfinance is an alternative for micro entrepreneurs and the poor, who are
normally not eligible or bankable to receive loans from commercial banks.
Baitul Maal wat Tamwil (BMTs) are Islamic micro financial co-operatives
with both social and economic functions. The central theme of this paper the role
of BMTs in carrying out these double functions in fostering local economic
development in three provinces of Indonesia namely West Java, Central Java,
and South Sulawesi. These three provinces constitute among the most populous
population in Indonesia and where many BMT have existed an operated .by
describing their performance and role in local economic development in those
three selected provinces.
The main empirical findings are as follows. Firstly, some of observed
BMTs have a high performance in terms of asset growth. Secondly BMTs activities
have a positive socio-economic impact on micro enterprises which become a
client of BMT. Thirdly, based on SWOT analysis, the prospect of BMTs are
promising either as Sharia based microfinance or as an empowering agent for
micro enterprises in the real sector.
57
JOURNAL OF ISLAMIC AND ECONOMICS, Volume 2 No 1 Juni 2008
micro entrepreneurs borrow money all banking transaction and its related
from the illegal moneylenders charging business. The very recent development
high interest rate. Those are not difficult of Islamic Financial development is
to find where the micro entrepreneurs the enactment of The Bill of Sharia
trapped in huge debt leading to their Banking in 2008. As above-mentioned
business bankruptcy. earlier in this paper, one of the
underlying reasons of the mushrooming
Since the early 1980s, there is growing (IMFIs) is that the awareness given
tendency to apply what Islamic Sharia the fact that the conventional banking
compels to Moslem adherents. In and micro finance institution does not
1991, the rise of Islamic Economic reach those marginalized group. This
came to the scene. During the last 15 situation happened because not only
years, there is growing awareness of classical collaterals and physical assets
sharia banking practice in Indonesia. prerequisites but also the reason for the
This development also goes further to application of sharia ruled by Moslem
widespread establishment of Islamic adherents.
Micro Finance Institutions (IMFIs).
One of burgeoning Islamic financial
Conventional microfinance itself not institution Indonesia is Baitul Maal
necessarily complies with the rule of Wat Tamwil (Islamic Financial
interest (usury) prohibition. Realization Cooperative). The first Baitul Maal
of Islamic economic application in the wat Tamwil (BMT) was established
realm of Indonesian economic entity in early 1980s but BMTs were not
is relatively new. The first milestone growth significantly until 1992. BMTs
of Islamic economics application was themselves can be classified as a non-
the establishment of Bank Muammalat governmental organization (NGO) with
Indonesia in 1 November 1991 and it the legal foundation as a cooperative.
effectively operates in September 2002. One of BMT activities is to finance
This bank is the first bank applying micro enterprise by soft loan called
sharia rules in its operation. One of Qard Hasan (loan without interest
conspicuous aspects of this bank is charge). Basically, Baitul Maal Wat
prohibition of riba (interest or usury) for Tamwil’s role are not only in financing
62
Teddy Lesmana, The Role of Islamic Micro Financial Cooperatives (Baitul Maal Wat Tamwil) in Lo-
cal Economic Development: Case Study of Three Provinces in Indonesia
micro-enterprise but it has social role well known as Moslem society though
in helping the disadvantaged people. in Toraja there is a small population
In Baitul Maal wat Tamwil, Baitul of Christian. Each province has three
Maal refers to its function of collecting BMTs sample. Besides Moslem
Zakat, Infaq, and Shadaqah and these population as the consideration, the
for non-profit activity. This function is choice of sample were because the high
in accordance with one of five pillars of number of BMTs operating in these
Islam that is Zakah for the prosperous three provinces.
Moslem. On the other hand, Baitut
Tamwil has role for profit motive from The main criteria are that the BMTs
fund it collected. In this function, Baitul which have operated no less than 5
Tamwil deals with economic activity years. The research conducted with
(ies) of micro enterprise and informal the following three considerations;
sector run mainly by people who firstly, the development of Islamic
traditionally has no access to formal microfinance has a positive role in
financial institution such bank. The poverty alleviation through micro
conventional banking usually requires enterprise run by poor people. Secondly,
collateral and legal formal requirements as an input for government, concerning
and most of micro enterprise and on micro finance development needed
informal economic activities cannot by the lower and middle class societies.
fulfill these requirements. Thirdly, to enrich the understanding
about Islamic microfinance institutions
IV. Field Survey: A Brief Preview development in Indonesia based on
empirical facts.
The economic research center The
Indonesian Institute conducted research Given the strategic role Baitul Maal
in exploring the role of Baitul Maal wat Tamwil as micro finance institution
wat Tamwil in local fostering local particularly in serving the poor and
economic development in 2006. The its double role both for non-profit
research picked up two provinces in Java and profit motives, this research has
- the most populous inhabited island in following two research questions first,
Indonesia - and South Sulawesi which how does the impact of the existence
63
JOURNAL OF ISLAMIC AND ECONOMICS, Volume 2 No 1 Juni 2008
and role of Baitul Maal wat Tamwil to pillars of Islam and obligatory on
socio-economic conditions especially every wealthy Muslim. Zakah and
towards its clients. Secondly, about the other forms of charities can be used to
effectivity of Baitul Maal Wat Tamwil increase the participation in production
in conducting its socio-economic role. of the poor Zakah can be integrated
Islamic Microfinance Institutions into the microfinance program in a
(IMFIs) demonstrated relatively high variety of ways to benefit the poorest
growth in terms of number in Indonesia. beneficiaries. It can be transferred to
In addition to the growing demand for the poor as outright grants or given as
Sharia rule application in economic and qard hasan and can be used either for
business transaction, the explanation consumption or for investment purposes.
why IMFIs are favorable in Indonesia is In case of the extreme poor, zakah can
that this kind of micro finance institution be given as grants to stop the diversion
has mission not only for business but of funds for consumption purposes so
also social motives. The underlying that the funds from IMFI can be used
of utter moslem values which place exclusively in production. As zakah
muamalat and strong brotherhood, will reduce the need for diverting funds
transparency, kindness, trust as taught meant for investment to unproductive
by the Prophet Muhammad PBUH. use, it is expected that investments in
In social aspect, IMFIs can reach the productive activities will increase the
marginalized people who have no strong overall return decreasing the probability
access to formal banking and financial of default. Thus, integrating zakah with
institution. Moslem teaching also put microfinancing will not only improve
the principle to help the disadvantaged the economic condition of the poor, but
by contributing some proportion of also ensure the repayment of the funds
wealth through Zakah. to the IMFI (Ahmed, 2002).
Table 1.
Asset Growth of Observed BMTs
Central Java
1. Bina Ummat Sejahtera 1996 10.000 24.400.000 30.200.000
2. Shohibul Ummat 1997 3.000 N.A. 3.000.000
3. Usaha Artha 1998 2.300 4.200.000 6.300.000
Sejahtera
West Java
1. Daarut Tauhid 1998 250 9.300.000 12.300.000
2. Barraah 1993 2.500 2.900.000 3.800.000
3. Mardlotillah 1997 7.000 1.700.000 1.900.000
South Sulawesi
1. Al Amin 1995 5.000 N.A. 1.300.000
2. Hikmah 1997 1.500 889.000 903.000
3. ”Kube”
Sejahtera 036 2004 187.500 249.000 256.200
(August
2005)
Source: Interview and Written sources, 2006
Table 2.
The Percentage of Clients’ Business Growth, Average
Profitability, and Asset
(Of Total Respondents Number)
Central South
Aspects West Java
Java Sulawesi
Business
78,0 76,7 64,9
Growth
Average 70,7 77,6 67,4
Profitability
74,0 60,0
Asset
75,0
significant growth namely 78%, 64.9%, profit sharing or output sharing. Many
and 76.7% respectively (these figures micro enterprise actors feel that they
refer to the number of respondents have been help to reap benefit from
as the BMT clients) . The reasons for the economic activities since BMTs
increasing business growth is that procedure in terms of loan access is
BMTs help them in fulfilling working easy so they can catch the opportunities
capital needed by micro enterprises. of business swiftly. Observed BMTs
By the support of the loan from BMTs, in three provinces have individual
the clients’ business volume increased. clients and group clients adopting
Since their businesses were trading, Yunus’ Grameen model. Most clients
the speed of capital availability is using BMTs loan as working capital.
very important. The supports from There are three kind of business
BMTs enable them to increase thier method related to BMTs and its clients
business volume given that increasing namely Mudharabah (profit sharing),
demand. The modes of financing of Musyarakah (profit loss sharing), and
BMTs usually in the forms of Qard Murabahah (cost plus). In cost plus,
Hasan (interest free loans), Shirakat the main objective is to buy capital
(partnerships) and exchange contracts good s for micro enterpreneurs such
(Mu’awadat). The partnership between motor rickshaw. Most of loan utilized
BMTs and its clients typically based on
67
JOURNAL OF ISLAMIC AND ECONOMICS, Volume 2 No 1 Juni 2008
they are facing fund availability. This have simple procedure in terms of loan
situation leads to the favorable condition procedure for the micro enterprise, fair,
for BMT to growth in Indonesia. In and have no burden for interest charge
2010 it will be planed the formation like conventional financial institutions.
of BMTs Center by PINBUK like a However, in addition to the positive
central bank for BMTs. PINBUK has images of BMT, one should pay
attention about the need for insurance
program to establish one BMT in each
or guarantor institution in likely credit
village in Indonesia. However, one crunch event.
caveat that should be anticipated is that
no guarantor or insurance institution Policy Recommendations
exists if BMTs suffering credit crunch
or even default and bankruptcy. By Given that important role of BMTs
joining in such BMTs associations in supporting local economic
mentioned above, BMTs can expand development, in the future, it is
their business to other area in a region. expected that government has intensify
BMTs itsel still facing problem of high its support to IMFIs, in this case
operating cost due to officers have to be are BMTs. Rather than pouring the
paid in administering thousand clients money to the people without strong
loan proposal. The amount of loan itself rationale and base, government can
poses some problematic challenges channel a proportion of public budget
given their small scale loans. through IMFIs (BMTs) which will
then administer and manage the fund
Conclusion for the appropriate clients. In addition,
Indonesia as the largest Moslem country
Based on field observation in the three has potential in mobilizing charitable
provinces in Indonesia (West Java, fund based on the rule of Islam such as
Central Java, and South Sulawesi) Zakah, Shadaqah, Infaq, and Waqf to
demonstrated that BMTs have strong productive economic activities. These
positive impact on local economic potentials may lead to greater boosting
development. Most of respondents of economic development since it can
assured that BMTs were helpful in reach the poorest community of society.
supporting their business growth. BMTs By growing real business activities in
69
JOURNAL OF ISLAMIC AND ECONOMICS, Volume 2 No 1 Juni 2008
70
Teddy Lesmana, The Role of Islamic Micro Financial Cooperatives (Baitul Maal Wat Tamwil) in Lo-
cal Economic Development: Case Study of Three Provinces in Indonesia
71