Financial Services Authority Regulation Number 15/POJK.03/2021 Concerning the Business Plan of Rural Credit Banks and Sharia Rural Financing Banks

COPY
FINANCIAL SERVICES AUTHORITY REGULATION
OF THE REPUBLIC OF INDONESIA
NUMBER 15/POJK.03/2021
CONCERNING
THE BUSINESS PLAN OF RURAL CREDIT BANKS AND
SHARIA RURAL FINANCING BANKS
BY THE GRACE OF GOD THE ALMIGHTY
THE COMMISSIONERS COUNCIL OF THE FINANCIAL SERVICES AUTHORITY, Considering:
a. that regulations regarding the business plan of Rural Credit Banks and Sharia Rural Financing Banks have been regulated in Financial Services Authority Regulation Number 37/POJK.03/2016 concerning the Business Plan of Rural Credit Banks and Sharia Rural Financing Banks; b. that regulations regarding the business plan of Rural Credit Banks and Sharia Rural Financing Banks are currently no longer in line with developments, thus requiring new regulations;
c. that based on the considerations referred to in letters a and b, and to increase efficiency, encourage simplification of reporting for Rural Credit Banks and Sharia Rural Financing Banks, and support principle-based regulation, it is necessary to establish a Financial Services Authority Regulation concerning the Business Plan of Rural Credit Banks and Sharia Rural Financing Banks;
Recalling:

1. Law Number 7 of 1992 concerning Banking (State Gazette of the Republic of Indonesia Year 1992 Number 31, Supplement to the State Gazette of the Republic of Indonesia Number 3472) as amended by Law Number 10 of 1998 concerning Amendments to Law Number 7 of 1992 concerning Banking (State Gazette of the Republic of Indonesia Year 1998 Number 182, Supplement to the State Gazette of the Republic of Indonesia Number 3790);
2. Law Number 21 of 2008 concerning Sharia Banking (State Gazette of the Republic of Indonesia Year 2008 Number 94, Supplement to the State Gazette of the Republic of Indonesia Number 4867);
3. Law Number 21 of 2011 concerning the Financial Services Authority (State Gazette of the Republic of Indonesia Year 2011 Number 111, Supplement to the State Gazette of the Republic of Indonesia Number 5253);
   DECIDING:
   Establishing: A FINANCIAL SERVICES AUTHORITY REGULATION CONCERNING THE BUSINESS PLAN OF RURAL CREDIT BANKS AND SHARIA RURAL FINANCING BANKS.

CHAPTER I
GENERAL PROVISIONS
Article 1
In this Financial Services Authority Regulation, the following terms are defined as:

1. Rural Credit Bank, hereinafter abbreviated as BPR, is a conventional bank that does not provide payment circulation services in its operations.
2. Sharia Rural Financing Bank, hereinafter abbreviated as BPRS, is a Sharia bank that does not provide payment circulation services in its operations.
3. Business Plan is a written document describing the development plan and business activities of BPR and BPRS over a certain period and the strategy to realize such plan according to the set targets and time.
4. Business Plan Implementation and Supervision Report is a report prepared by the Board of Directors and Board of Commissioners of BPR and BPRS regarding the implementation of the Business Plan by the Board of Directors and the results of the Board of Commissioners' supervision over the implementation of the Business Plan up to a certain period.
5. Board of Directors is the Board of Directors for BPR and BPRS in the form of a limited liability company, regional public enterprise, regional joint-stock company, regional enterprise, or management for BPR in the form of a cooperative legal entity.
6. Board of Commissioners is the Board of Commissioners for BPR and BPRS in the form of a limited liability company legal entity, or Commissioner for BPR in the form of a regional joint-stock company legal entity, Supervisory Board for BPR in the form of a regional public enterprise legal entity and regional enterprise legal entity, and Supervisor for BPR in the form of a cooperative legal entity.

Article 2
(1) BPR and BPRS are required to prepare a Business Plan realistically every year.
(2) The Business Plan referred to in paragraph (1) must be prepared by the Board of Directors and approved by the Board of Commissioners.
(3) The Business Plan prepared by BPR and BPRS as referred to in paragraph (1) must reflect the direction and policy of business development of BPR and BPRS in the short term, medium term, and long term. (4) The direction and policy of business development of BPR and BPRS in the long term as referred to in paragraph (3) includes the vision and mission of BPR and BPRS.

Article 3
(1) BPR and BPRS must prepare a Business Plan as referred to in Article 2 paragraph (1), by considering:
a. external and internal factors that can affect the sustainability of the business of BPR and BPRS; and b. prudential principles and sound banking principles.
(2) In addition to considering factors as referred to in paragraph (1), BPRS must prepare a Business Plan by considering Sharia principles.

Article 4
(1) The Board of Directors is required to implement the Business Plan effectively.
(2) The Board of Directors is required to provide explanations regarding the Business Plan to:
a. shareholders of BPR and BPRS; and b. all levels of the organization within BPR and BPRS.

Article 5
The Board of Commissioners is required to supervise the implementation of the Business Plan.

Article 6
(1) BPR or BPRS that violates the provisions as referred to in Article 2 paragraph (1) shall be subject to administrative sanctions in accordance with the Financial Services Authority Regulation regarding reporting of rural credit banks and sharia rural financing banks through the financial services authority reporting system. (2) BPR or BPRS that violates the provisions as referred to in Article 2 paragraph (2) shall be subject to administrative sanctions in the form of a written reprimand. (3) In the event that BPR or BPRS has been subject to administrative sanctions as referred to in paragraph (2), and violates the provisions as referred to in Article 2 paragraph (2), BPR or BPRS may be subject to administrative sanctions in the form of:
a. a reduction in the health level of BPR and BPRS by one predicate; and/or b. temporary suspension of some operational activities of BPR and BPRS.
(4) Members of the Board of Directors and/or members of the Board of Commissioners who violate the provisions as referred to in Article 4 paragraph (1), Article 4 paragraph (2), and/or Article 5 may be subject to administrative sanctions in the form of a prohibition from acting as a principal in accordance with the Financial Services Authority Regulation regarding the re-evaluation of principals of financial service institutions.

CHAPTER II
SCOPE OF THE BUSINESS PLAN
Article 7
The Business Plan as referred to in Article 2 must at least contain:
a. executive summary; b. business strategy and policies;
c. projected financial statements;
d. target ratios and financial items; e. fund mobilization plan; f. fund disbursement plan; g. capital plan; h. information technology development and procurement plan and human resource development;
i. plan for implementing new business activities for BPR or plan for issuing products and implementing new activities for BPRS;
j. plan for network development and/or branch office changes; and k. other information.

Article 8
(1) The executive summary as referred to in Article 7 letter a must at least contain:
a. vision and mission of BPR or BPRS; b. strategic plans and steps to be taken by BPR or BPRS;
c. key financial indicators; and
d. short-term and medium-term targets.
(2) The strategic plans and steps to be taken by BPR and BPRS as referred to in paragraph (1) letter b are explained for the short term and medium term.
(3) Key financial indicators as referred to in paragraph (1) letter c must at least include the performance of BPR or BPRS calculated in the health level assessment of BPR or BPRS in accordance with:
a. provisions of legislation regarding the health level assessment of rural credit banks; and b. Financial Services Authority Regulation regarding the health level assessment system for sharia rural financing banks. (4) Short-term targets as referred to in paragraph (1) letter d must at least contain:
a. reduction of non-performing loans or non-performing financing; b. improvement of intermediary functions;
c. improvement of efficiency; and
d. risk management and corporate governance policies of BPR and BPRS.
(5) Medium-term targets as referred to in paragraph (1) letter d must at least contain efforts to strengthen capital.

Article 9
Business strategy and policies as referred to in Article 7 letter b must at least contain:
a. analysis of the position of BPR and BPRS in business competition based on assets and/or location; b. policy direction of BPR and BPRS;
c. risk management and corporate governance policies of BPR and BPRS;
d. fund mobilization and credit or financing disbursement strategies; and e. strategy for resolving strategic problems and/or compliance with BPR and BPRS regulations.

Article 10
(1) Projected financial statements as referred to in Article 7 letter c must at least contain:
a. financial position report; b. profit and loss; and
c. administrative account.
(2) BPR or BPRS with core capital less than IDR 50,000,000,000.00 (fifty billion rupiah) submits projected financial statements as referred to in paragraph (1) up to 1 (one) year ahead. (3) BPR or BPRS with core capital of at least IDR 50,000,000,000.00 (fifty billion rupiah) submits projected financial statements as referred to in paragraph (1) up to 3 (three) years ahead.

Article 11
(1) Target ratios and financial items as referred to in Article 7 letter d must at least contain:
a. target core financial ratios; and b. target ratios for other specific items.
(2) BPR or BPRS with core capital less than IDR 50,000,000,000.00 (fifty billion rupiah) submits target ratios and financial items as referred to in paragraph (1) up to 1 (one) year ahead. (3) BPR or BPRS with core capital of at least IDR 50,000,000,000.00 (fifty billion rupiah) submits target ratios and financial items as referred to in paragraph (1) up to 3 (three) years ahead.

Article 12
The fund mobilization plan as referred to in Article 7 letter e must at least contain:
a. third-party fund mobilization plan; and b. other fund mobilization plans.

Article 13
(1) The fund disbursement plan as referred to in Article 7 letter f must at least contain:
a. credit or financing disbursement plan based on the largest economic sector in credit or financing disbursement; b. credit or financing disbursement plan based on type of use; and
c. credit or financing disbursement plan based on type of business.
(2) In addition to preparing the fund disbursement plan as referred to in paragraph (1), BPRS must prepare a financing disbursement plan based on contracts (akad).

Article 14
The capital plan as referred to in Article 7 letter g must at least contain:
a. plan for changes or additions to paid-up capital; b. donation capital; and/or
c. revaluation of fixed assets.

Article 15
The information technology development and procurement plan and human resource development as referred to in Article 7 letter h must at least contain:
a. fundamental information technology development and procurement plan; and b. human resource development plan, at least containing:

1. human resource recruitment plan;
2. human resource education and training plan; and
3. outsourcing workforce utilization plan.

Article 16
(1) The plan for implementing new business activities for BPR as referred to in Article 7 letter i includes the implementation plan for business activities that require approval and/or reporting to the Financial Services Authority in accordance with the Financial Services Authority Regulation regarding rural credit bank business activities. (2) The plan for issuing products and implementing new activities for BPRS as referred to in Article 7 letter i must at least contain:
a. plan for issuing new products; and b. plan for implementing new activities.

Article 17
The plan for network development and/or branch office changes as referred to in Article 7 letter j must at least contain:
a. plan for relocating the head office and/or branch office address; b. plan for opening and/or closing branch offices; and
c. plan for changing the status of the office network.

Article 18
Other information as referred to in Article 7 letter k must at least contain information estimated to affect the business activities of BPR and BPRS.

CHAPTER III
SUBMISSION, AMENDMENT, AND REPORTING OF THE BUSINESS PLAN
Article 19
(1) BPR and BPRS are required to submit the Business Plan as referred to in Article 2 to the Financial Services Authority no later than December 15 before the Business Plan year begins. (2) The Financial Services Authority may request BPR and BPRS to present or provide a comprehensive explanation regarding the Business Plan submitted by BPR and BPRS.

Article 20
(1) The Financial Services Authority may request BPR and BPRS to adjust the Business Plan that has been submitted by BPR and BPRS.
(2) BPR and BPRS are required to submit adjustments to the Business Plan as referred to in paragraph (1) to the Financial Services Authority no later than 30 (thirty) days after the date of the Financial Services Authority's letter.

Article 21
(1) In the event that there are external and internal factors that significantly affect operational activities and/or performance of BPR or BPRS, BPR or BPRS may make changes to the Business Plan as referred to in Article 2. (2) The Financial Services Authority may request BPR and BPRS to present or provide a comprehensive explanation regarding changes to the Business Plan as referred to in paragraph (1). (3) Changes to the Business Plan as referred to in paragraph (1) can only be made 1 (one) time and submitted to the Financial Services Authority no later than the end of June of the current year. (4) Changes to the Business Plan as referred to in paragraph (3) are implemented no earlier than 30 (thirty) days after the date of submission of the Business Plan changes.

Article 22
(1) BPR and BPRS are required to submit the Business Plan Implementation and Supervision Report semi-annually.
(2) The Report as referred to in paragraph (1) must be submitted to the Financial Services Authority no later than 1 (one) month after the relevant semester ends.
(3) The Report as referred to in paragraph (1) must at least contain:
a. achievement of the Business Plan in the form of a comparison between plan and realization; b. explanation regarding the causes and obstacles of the difference between the plan and realization of the Business Plan;
c. follow-up efforts that have been and will be taken to improve the realization achievement of the Business Plan;
d. results of analysis or identification and the opinion of the Board of Commissioners regarding supervision over the implementation of the Business Plan by the Board of Directors; and e. supervision steps that have been and will be taken by the Board of Commissioners in the process of supervising the Business Plan. (4) The Report as referred to in paragraph (1) must be signed by the President Director and Chief Commissioner of BPR and BPRS. (5) In the event that there is no President Director and Chief Commissioner as referred to in paragraph (4), the report must be signed by one member of the Board of Directors and one member of the Board of Commissioners of BPR and BPRS.

Article 23
Submission of the Business Plan as referred to in Article 19 paragraph (1), submission of Business Plan adjustments as referred to in Article 20 paragraph (2), submission of Business Plan changes as referred to in Article 21 paragraph (3), and submission of the Business Plan Implementation and Supervision Report as referred to in Article 22 paragraph (2) are carried out in accordance with the Financial Services Authority Regulation regarding reporting of rural credit banks and sharia rural financing banks through the financial services authority reporting system.

Article 24
(1) BPR or BPRS that is late in fulfilling the obligation to submit the Business Plan, Business Plan adjustment, or Business Plan Implementation and Supervision Report as referred to in Article 19 paragraph (1), Article 20 paragraph (2), or Article 22 paragraph (2) shall be subject to administrative sanctions in the form of a fine of:
a. IDR 100,000.00 (one hundred thousand rupiah) per day of delay and at most IDR 5,000,000.00 (five million rupiah) for BPR or BPRS with core capital less than IDR 50,000,000,000.00 (fifty billion rupiah); or b. IDR 300,000.00 (three hundred thousand rupiah) per day of delay and at most IDR 15,000,000.00 (fifteen million rupiah) for BPR or BPRS with core capital of at least IDR 50,000,000,000.00 (fifty billion rupiah). (2) BPR or BPRS that has been subject to administrative sanctions in the form of a fine as referred to in paragraph (1) must still submit the Business Plan, Business Plan adjustment, or Business Plan Implementation and Supervision Report.

Article 25
(1) BPR and BPRS that submit Business Plan adjustments as referred to in Article 20 paragraph (2), but:
a. are assessed as incomplete; and/or b. are not accompanied by documents and information in accordance with the scope established in this Financial Services Authority Regulation and/or other related implementation regulations, shall be subject to a written reprimand. (2) If within a period of 14 (fourteen) days after the written reprimand as referred to in paragraph (1) BPR and BPRS do not correct the Business Plan adjustment as referred to in Article 20 paragraph (2), BPR or BPRS shall be subject to a second written reprimand. (3) If within a period of 7 (seven) days after the second written reprimand as referred to in paragraph (2) BPR and BPRS do not correct the Business Plan adjustment as referred to in Article 20 paragraph (2), BPR or BPRS shall be subject to administrative sanctions in the form of a fine of:
a. IDR 3,000,000.00 (three million rupiah) for BPR or BPRS with core capital less than IDR 50,000,000,000.00 (fifty billion rupiah); or b. IDR 9,000,000.00 (nine million rupiah) for BPR or BPRS with core capital of at least IDR 50,000,000,000.00 (fifty billion rupiah). (4) BPR or BPRS that has been subject to administrative sanctions in the form of a fine as referred to in paragraph (3) must still submit the Business Plan adjustment.

Article 26
BPR or BPRS that violates the provisions as referred to in Article 22 paragraph (1) shall be subject to administrative sanctions in accordance with the Financial Services Authority Regulation regarding reporting of rural credit banks and sharia rural financing banks through the financial services authority reporting system.

CHAPTER IV
TRANSITIONAL PROVISIONS
Article 27
(1) BPR and BPRS submit the Business Plan Supervision Report for the position at the end of June 2021 no later than August 31, 2021 in accordance with Financial Services Authority Regulation Number 37/POJK.03/2016 concerning the Business Plan of Rural Credit Banks and Sharia Rural Financing Banks. (2) BPR and BPRS for the first time submit the Business Plan in accordance with this Financial Services Authority Regulation to the Financial Services Authority no later than December 15, 2021. (3) BPR and BPRS for the first time submit the Business Plan Implementation and Supervision Report in accordance with this Financial Services Authority Regulation to the Financial Services Authority no later than January 31, 2022.

CHAPTER V
CLOSING PROVISIONS
Article 28
Further provisions regarding the Business Plan of BPR and BPRS shall be established by the Financial Services Authority.

Article 29
At the time this Financial Services Authority Regulation takes effect, provisions regarding cash offices and cash service activities as regulated in Financial Services Authority Regulation Number 62/POJK.03/2020 concerning Rural Credit Banks and Financial Services Authority Regulation Number 3/POJK.03/2016 concerning Sharia Rural Financing Banks remain in effect insofar as they do not conflict with this Financial Services Authority Regulation.

Article 30
At the time this Financial Services Authority Regulation takes effect, Financial Services Authority Regulation Number 37/POJK.03/2016 concerning the Business Plan of Rural Credit Banks and Sharia Rural Financing Banks (State Gazette of the Republic of Indonesia Year 2016 Number 258, Supplement to the State Gazette of the Republic of Indonesia Number 5955) is repealed and declared invalid.

Article 31
This Financial Services Authority Regulation takes effect on the date of its promulgation.

This copy is in accordance with the original
Director of Law 1
Legal Department signed
Mufli Asmawidjaja

To ensure everyone knows, ordering the promulgation of this Financial Services Authority Regulation by placing it in the State Gazette of the Republic of Indonesia.

Established in Jakarta on August 10, 2021
CHAIRMAN OF THE COMMISSIONERS COUNCIL
FINANCIAL SERVICES AUTHORITY
REPUBLIC OF INDONESIA, signed
WIMBOH SANTOSO

Promulgated in Jakarta on August 24, 2021
MINISTER OF LAW AND HUMAN RIGHTS
REPUBLIC OF INDONESIA, signed
YASONNA H. LAOLY
STATE GAZETTE OF THE REPUBLIC OF INDONESIA YEAR 2021 NUMBER 190

EXPLANATION
OF
FINANCIAL SERVICES AUTHORITY REGULATION
OF THE REPUBLIC OF INDONESIA
NUMBER 15/POJK.03/2021
CONCERNING
THE BUSINESS PLAN OF RURAL CREDIT BANKS AND
SHARIA RURAL FINANCING BANKS

I. GENERAL
To increase efficiency and encourage simplification of reporting for BPR and BPRS, as well as to support principle-based regulation, it is necessary to update regulations related to the business plan of BPR and BPRS through simplification of the business plan scope, merging of realization reports and business plan supervision reports, simplification of network development plans reported in the business plan, and adjustment of the criteria for the Financial Services Authority's authority to request BPR and BPRS to adjust their business plans. Through these regulatory updates, it is hoped that BPR and BPRS will be encouraged to focus on business development and business activities of BPR and BPRS, thereby increasing the role and function of BPR and BPRS towards the regional economy and the national banking industry. In addition, with the development of regulations related to the business plan of BPR and BPRS, including Financial Services Authority Regulations related to BPR and BPRS reporting through the financial services authority reporting system, it is necessary to align certain aspects of regulation on the business plan of BPR and BPRS.

In light of this, it is necessary to update Financial Services Authority Regulation Number 37/POJK.03/2016 concerning the Business Plan of Rural Credit Banks and Sharia Rural Financing Banks.

II. ARTICLE BY ARTICLE
Article 1
Sufficiently clear.

Article 2
Paragraph (1)
What is meant by "realistic business plan" is a business plan that is measurable and achievable.

Paragraph (2)
Sufficiently clear.

Paragraph (3)
What is meant by "short term" is for a period of 1 (one) year.
What is meant by "medium term" is for a period of 3 (three) years.
What is meant by "long term" is for a period of 5 (five) years.

Paragraph (4)
Sufficiently clear.

Article 3
Paragraph (1)
Letter a
What is meant by "external factors" includes, among others, economic conditions, government policies, competition with financial service institutions or other entities, and technological developments. Included in the impact of economic conditions are developments in social and political conditions as well as natural, non-natural, and social disasters.

The term "internal factors" includes, among others, financial conditions, management, and human resources, as well as other infrastructure capabilities including information technology.

Letter b
Sufficiently clear.

Paragraph (2)
The term "Sharia principles" refers to Islamic legal principles in banking activities based on fatwas issued by institutions authorized to issue fatwas in the field of Sharia.

Article 4
Paragraph (1)
A Business Plan is considered effectively implemented when the targets set in the Business Plan are realized and provide a positive impact on the development of the BPR or BPRS business.

Paragraph (2)
Letter a
Explanation of the Business Plan to shareholders is an explanation regarding the implementation plan of the Business Plan to attract shareholder attention, including matters requiring shareholder support.

The submission of the explanation of the Business Plan to shareholders can be done, among others, through meetings, correspondence, or other forms of communication evidenced by written documents, including electronic documents.

Letter b
Explanation of the Business Plan to all levels of the BPR and BPRS organization is done with the aim that the policy and implementation of the Business Plan by each involved party aligns with the vision and mission of the BPR and BPRS.

The submission of the explanation to all levels of the BPR and BPRS organization can be done, among others, through the holding of meetings or other forms of communication evidenced by written documents.

Article 5
Supervision of the implementation of the Business Plan is conducted to ensure the achievement of targets outlined in the Business Plan. The form of supervision must be evidenced by written documents.

Article 6
Sufficiently clear.

Article 7
Sufficiently clear.

Article 8
Sufficiently clear.

Article 9
Letter a
In the position analysis, the problems and obstacles faced by BPR and BPRS in facing competition with financial service institutions and/or other entities, including other BPR and/or BPRS, are explained.

Letter b
The policy direction of BPR and BPRS is explained in the short and medium term, covering general information on BPR or BPRS policies established by management in the development of BPR or BPRS business in the future, including business development strategies in the digital era, as well as plans for the merger, amalgamation, and takeover of BPR or BPRS.

Included in the business development strategy is the development of information technology, as well as strategies to anticipate changes in external conditions.
For BPRS, this also includes policy directions regarding the strengthening of the application of Sharia principles.

Letter c
The application of risk management and governance policies in accordance with Financial Services Authority Regulations regarding:

1. the application of risk management for rural credit banks;
2. the application of risk management for Sharia rural financing banks;
3. the application of governance for rural credit banks;
   and/or
4. the application of governance for Sharia rural financing banks,
   including risk management and governance assessment targets.

Letter d
Sufficiently clear.

Letter e
The term "strategic issues" refers to issues that affect the health level or supervisory status of BPR and BPRS. Strategies for resolving strategic issues include steps to resolve problematic credits or financing that have or may affect the performance or health level of BPR and BPRS.

The term "compliance with BPR and BPRS regulations" includes, among others, capital adequacy including the fulfillment of minimum core capital in accordance with Financial Services Authority Regulations regarding:

1. the fulfillment of the minimum capital provision ratio and the fulfillment of minimum core capital for rural credit banks; or
2. the fulfillment of the minimum capital provision ratio and the fulfillment of minimum core capital for Sharia rural financing banks.

Article 10
Paragraph (1)
Financial position reports, income statements, and administrative accounts in accordance with Financial Services Authority Regulations regarding reporting by rural credit banks and Sharia rural financing banks through the Financial Services Authority reporting system.

Paragraph (2)
Sufficiently clear.

Paragraph (3)
Sufficiently clear.

Article 11
Paragraph (1)
Letter a
Core financial ratio targets include ratios that provide information for assessing the health level of BPR and BPRS in accordance with applicable laws and regulations regarding the assessment of the health level of rural credit banks or Financial Services Authority Regulations regarding the health level assessment system for Sharia rural financing banks.

Letter b
Target ratios for certain other items include targets for several ratios related to credits or financing for micro, small, and medium enterprises against total credits or financing; the ratio of education and training funds against the total labor costs of the previous year; the ratio of the realization of education and training funds against the total budgeted education and training funds; and the ratio of foreclosed collateral against total credits or financing.

Paragraph (2)
Sufficiently clear.

Paragraph (3)
Sufficiently clear.

Article 12
Letter a
Plans for the collection of third-party funds include information regarding targets, marketing strategies, and sources for collecting savings and deposits.

Letter b
Plans for the collection of other funds include information regarding targets, reception strategies, and sources for receiving loans from other banks and/or loans not originating from banks.

Article 13
Paragraph (1)
Letter a
The term "largest economic sector" refers to at most 5 (five) economic sectors with the largest percentage of credit or financing disbursement from the total portfolio of credit or financing disbursement of BPR and BPRS.

Letter b
The term "type of use" includes working capital, investment, and consumption in accordance with Financial Services Authority Regulations regarding reporting by rural credit banks and Sharia rural financing banks through the Financial Services Authority reporting system.

Letter c
The term "type of business" includes micro, small, and medium enterprises in accordance with Laws regarding micro, small, and medium enterprises.

Paragraph (2)
Sufficiently clear.

Article 14
Included in the capital plan are strategies and information regarding changes or additions to capital.

Article 15
Letter a
Plans for the development and procurement of fundamental information technology in accordance with Financial Services Authority Regulations regarding standards for the implementation of information technology for rural credit banks and Sharia rural financing banks.

Letter b
Number 1)
Sufficiently clear.

Number 2)
The preparation of human resource education and training plans is done by considering, among others, Financial Services Authority Regulations regarding the obligation to provide education and training funds for the development of human resources for rural credit banks and Sharia rural financing banks.

Number 3)
The term "outsourcing" refers to the submission of part of the work execution to a service provider company through a contracting agreement and/or through a labor supply service agreement in accordance with applicable laws and regulations. Plans for the utilization of outsourced labor include plans for the utilization of labor outside permanent labor, including the number, field of work, and duration of assignment.

Article 16
Paragraph (1)
Business activity implementation plans consider Financial Services Authority Regulations regarding the application of risk management for rural credit banks. BPR business activities include BPR products and activities.

Paragraph (2)
Plans for the issuance of new products and the implementation of new activities that need to be included in the Business Plan in accordance with Financial Services Authority Regulations regarding products and activities of Sharia banks and Sharia business units and the application of risk management for Sharia rural financing banks.

Article 17
Branch office explanations and changes in office network status in accordance with Financial Services Authority Regulations regarding rural credit banks and Sharia rural financing banks.

Article 18
Information estimated to affect BPR and BPRS business activities includes, among others, plans to cease business activities, products, or activities that have a material impact on the financial performance or risk profile of BPR and BPRS, including information required by applicable laws and regulations to be included in the Business Plan.

Article 19
Paragraph (1)
Business Plans start from January 1 to December 31 of each year.

Paragraph (2)
Sufficiently clear.

Article 20
Sufficiently clear.

Article 21
Paragraph (1)
External and internal factors that significantly affect operational activities and/or affect the performance of BPR or BPRS include, among others, solvency or liquidity issues that affect the risk profile or health level of BPR and BPRS.

Paragraph (2)
Sufficiently clear.

Paragraph (3)
Sufficiently clear.

Paragraph (4)
Sufficiently clear.

Article 22
Paragraph (1)
The term "semi-annual" refers to the end position of June and December.

Paragraph (2)
Sufficiently clear.

Paragraph (3)
Letter a
Sufficiently clear.

Letter b
Sufficiently clear.

Letter c
Sufficiently clear.

Letter d
Included in the results of analysis or identification and the opinion of the Board of Commissioners are the results of supervision regarding the implementation of lending policies and lending procedures by the Board of Directors in accordance with Financial Services Authority Regulations regarding productive asset quality and provisioning for write-off of productive assets for rural credit banks and productive asset quality and provisioning for write-off of productive assets for Sharia rural financing banks.

Letter e
Sufficiently clear.

Paragraph (4)
Sufficiently clear.

Paragraph (5)
The signing of the report is carried out by members of the Board of Directors and members of the Board of Commissioners in accordance with the authority in the articles of association.

Article 23
Sufficiently clear.

Article 24
Sufficiently clear.

Article 25
Paragraph (1)
Letter a
The term "incomplete" means not in accordance with the request of the Financial Services Authority.

Letter b
Sufficiently clear.

Paragraph (2)
Sufficiently clear.

Paragraph (3)
Sufficiently clear.

Paragraph (4)
Sufficiently clear.

Article 26
Sufficiently clear.

Article 27
Sufficiently clear.

Article 28
Further provisions regarding Business Plans include, among others, the scope and procedures for submission, adjustment, and changes to Business Plans, as well as Reports on Implementation and Supervision of Business Plans.

Article 29
Sufficiently clear.

Article 30
Sufficiently clear.

Article 31
Sufficiently clear.

SUPPLEMENT TO THE STATE GAZETTE OF THE REPUBLIC OF INDONESIA NUMBER 6712