Mutiara Bank Tbk has announced its plans to enter the micro business sector. The banks aims to make microlending a significant source of income and thus raise its value and performance level.

The bank has already applied for the necessary permits from Bank Indonesia and is expected to have the official permit in February 2013.

The micro business lending scheme was tested through a pilot program in five of the bank’s branches over the course of 2012. For 2013, Mutiara Bank plans to build 13 micro loan clusters with 50 up to 100 micro outlets of kiosks across Indonesia. The first micro loan outlet will be built at Mutiara Bank’s main office in Fatmawati, South Jakarta.

The bank is targeting micro funding of 720 billion RP in the first year of operations which will be disbursed through partnerships or ‘channeling’ and through direct loans to end consumers. Micro loan disbursement will be mainly focused on the trade sector as one of the key economic pillars of small, rural communities.