Yunus told Yunus go, We understood but not to go

keywords: poverty in Indonesia, alleviation poverty, empowerment, reduction the number of poor people, BPS or “Badan Pusat Statistik” (Central Statistics Agency), GOI or “Government Of Indonesia”, Rp or "Rupiah" (Indonesian currency)

MUHAMMAD Yunus a week ago (2nd week of August) came on Indonesia. But the controversy still last until now. The Nobel laurate from Bangladesh sugest that Indonesia “needs to establish an independent regulatory body to govern and supervise its microcredit sector if it is to grow in line with its potential”. Yunus added that an independent body for the microcredit sector was very important due to the specific and unique nature of the business. "Rather than leave it to the central bank, it should instead be done by an independent regulatory body created for microcredit. It can't be just pushed into one of the corners of the central bank," said Yunus on The Jakarta Post. He said he had always promoted the idea of an independent regulatory authority, but it took decades for the Bangladeshi government to eventually agree to the establishment of such a body. He said the ultimate solution for the microcredit sector was legal reform that would allow any financial-sector organization to become a microcredit provider. When asked why Indonesia's microcredit experience had not been so successful, Yunus said the microcredit sector in any country should keep itself as far away as possible from the government. He said that preventing the government from getting involved in the microcredit banking sector had been a continuous struggle for him since he first became involved in microcredit in 1976, especially in the 1990s when the microcredit concept in Bangladesh became very popular. "The more the government is involved, the messier the business.

We always make it very clear to the government that microcredit and the government is bad chemistry." Yunus add that if "We always told them to stay away from it, help us in the policy-making field, don't give us money directly,". What the government could do was provide a revolving fund to provide start-up capital that would later be managed and used by the sector. Also, he said, in order to secure more money for microcredit, all financial institutions should be allowed to create deposits for extending loans to the poor.
Grameen Bank had arranged a core deposit derived in part from the World Bank and the Bangladeshi government. "The government's money has been paid back, the World Bank's money is about to be paid back. But the bank still has a lot of money on its own. So now, they lend the money out and recycle the money themselves," Yunus told the meeting.

The Yunus’ phenomenon is unique. Actually he learned how to operate microcredit is from Indonesia –maybe at 1970, he came to study a cooperative in Malang, East Java. He was a student, but now, Yunus is an expert and try to teach us. Bambang Ismawan, one of Indonesianis ‘actor’ in microcredit, ever made a joke that if “Bangladesh call himself as the motherland of microfinance, so Indonesia is ……the fatherland of microfinance.”
This phenomenon similar with how Korean technology is faster than its teacher –Japan and US. Or maybe Malaysia who overlaps Indonesia in education. Actually we have a long story in micro finance. We have Bank Rakyat Indonesia(BRI) was considered one of the best micro finance institutions in the world. It became a model bank in Asia after its transformation from an ailing government-owned commercial bank into a viable self-sufficient financial intermediary. Its success revealed to the world how microcredit could help in a bank's long-term stability even in times of crises.
But refers to Yunus’ suggestion, it is not quite understand to apply in Indonesia. Indonesia has some ‘independent body’ but almost still defend on state budget. There is 32 independent body in Indonesia (i.e: Bank Indonesia, Komisi Pemilihan Umum, Komnas HAM, Komisi Pemberantasan Korupsi, Panitia Pengawas Pemilu, Arsip Nasional RI, Badan Intelijen Nasional, Badan Kepegawaian Negara, Badan Pengawas Tenaga Nuklir, Badan Pengb Kebudayaan dan Pariwisata, Badan Pertanahan Nasional, Badan POM, Badan Pusat Statistik, Badan Standardisasi Nasional, Badan Tenaga Nuklir Nasional, Badan Urusan Logistik, Bakosurtanal, Bapedal, Bappenas, BKKBN, BKPM, BPKP, BPPN, BPPT, Dewan Ketahanan Nasional, LAPAN, Lembaga Administrasi Negara, Lembaga Informasi Nasional, Lembaga Sandi Negara, Lemhanas, LIPI, Perpustakaan Nasional). Maybe the difference situation between INA and Bangladesh did not understood by Yunus.

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MICROFINANCE AND ITS POTENTIAL FOR POVERTY ALLEVIATION
Arsyad Lincolin on Gadjah Mada International Journal of Bussiness at May-August 2006 presenting article about “Assesing Factors Affecting the Repayment Rate of Microfinance Institution: A Case Study of Village Credit Institution of Gianyar Bali”. He starated with the term microfinance refers to the pro vision of financial services (gen¬erally savings and credit) to low-in¬come clients (ADB 2000; Ledgerwood 1999; Robinson 2001). The clients are often identified as traders, street ven¬dors, small farmers, service providers (hairdressers, rickshaw drivers), and artisans and small producers, such as blacksmith&and seamstresses. In prac¬tice, however, in addition to financial intermediation, some microfinance institutions provide social intermedia¬tion services such as group formation, development of self-confidence, and training in financial literacy and man¬agement capabilities among members of a group intended to benefit low-income women and men (Bennett 1998; Ledgerwood 1999). Part of the reasons is because low-income people face strong barriers (such as illiteracy, gender discrimination, and remote¬ness) in trying to gain access to ordi¬nary financial service institutions (Ledgerwood 1999: 63). This means that the skills and confidence of low-income people have to be developed in addition to credit provision. There¬fore, the microfinance approach is not a minimalist approach offering only financial intermediation but an inte¬grated approach offering both finan¬cial intermediation and other services mentioned above (Ledgerwood 1999: 65).

Another version refers to “Microfinance for Poverty Reduction: Building Inclusive Financial Sectors in Asia and the Pacific”, ESCAP United Nation, 2006, Microfinance is the fastest growing segment of rural financial intermediation in the Asia-Pacific region. Spearheaded by non-governmental organizations (NGOs), microfinance is gaining a significant place in the national development plans of the region in the form of innovative field projects and programmes aimed at poverty reduction. For several decades, countries in Asia, which peopled approximately a third of the world's poor, were witness to targeted and subsidy-linked credit schemes as part of anti-poverty . interventions. Such interventions have had a mixed impact on poverty. While some analysts argue that the government's anti-poverty schemes/projects have created conditions for poor people to participate in the local economy, others argue that these have adversely affected the credit discipline and created a dependency culture. A growing emphasis of microfinance practice is placed on the sustainability of its approach and the potential to integrate with the mainstream financial sector. In the discussion on microfinance development, 'inclusive financial sector development,' implies the identification of ways and means of enabling universal access to a complete range of financial services and the integration of the poorer segments of populations into the financial systems and markets. This aspect has been identified as one of the key challenges of accelerating poverty reduction. This sectoral approach is intrinsically linked to the possible future trajectories of the growth of microfinance in the Asia and the Pacific region and the'way in which different national governments provide a fillip to the ongoing efforts to strengthen microfinance initiatives.

ESCAP United Nation, 2006 wrote that The potential and real impact of microfinance on poverty reduction has been well recognized in the world. Despite several methodological and computational limitations of research studies, it has been established prima facie that microfinance has the potential to address poverty through enhanced business/economic opportunities, enhanced income, smoothing of consumption and preparing the poor for shocks or addressing the vulnerability in the aftermath of shocks. It has been observed widely across Asia that microfinance has addressed critical determinants related to poverty, vulnerability and coping with crisis. While observing various delivery mechanisms, many studies recognize the potential and real impact of microfinance on poverty reduction. Studies from Bangladesh indicate positive impacts on several economic and social indicators. One of the earliest studies by Hossain, M. (1988) indicates a positive change in terms of working capital needs, non-agriculture investments and labour force participation rate and income increase resulting from microcredit activities. Similarly, improvements in social and economic empowerment are reported in a study of IMEC, PK (1995). Rahman, R. (1996) indicates an increase in household consumption expenditure and human capital investment as a result of microcredit. Pitt and Khandker (1996) indicate an increase in household expenditure, increased participation of girls in education and a positive change in women's non-land assets as the impact of microcredit programmes. Khadker, S. (2003) shows how ".... microcredit programmes operating in Bangladesh over a long period have produced a greater impact on extreme poverty than on moderate poverty". The results of this study strongly support the view that"... microcredit not only affects the welfare of participants and non-participants but also aggregate welfare at the village level". Similarly, several impact studies have also concluded the positive impact of microcredit in disaster situations and during post-disaster rehabilitation periods. Further, it was found that cash flows were smoothened by diversification of earnings, increased employment of family members and reliance on small businesses.4 Similarly, studies in Indonesia found that microcredit borrowers increased their incomes by 12.9 per cent as compared with an increase of 3 per cent in the incomes of control groups. In another study, Bank Rakyat Indonesia (BRI) borrowers reported that on an average, clients' incomes had increased 112 per cent and that 90 per cent of the households moved out of poverty.

Thus, the provision of small loans to the poor, especially women, has been one of the consistent strategies for poverty reduction in all these countries in the past two decades. These loans have been channelled either through government-led anti-poverty programmes, international non¬governmental organizations (INGOs) and donor-led development projects, specialist microfinance institutions (MFIs)6 or civil society-/community-based initiatives. The pioneering work of Grameen Bank in Bangladesh followed by similar others in South-Asia and East-Asia during the decades of 1980s-1990s were hallmarks of microfinance activities of the region.7 In the 1990s, not-for-profit NGO MFIs, commerce-oriented MFIs and their operations grew rapidly in most of the Asia and the Pacific region, thereby presenting opportunities of meeting the credit needs of the poor through diverse modes of delivery. During the same period, India and other South Asian countries experimented self-help groups (SHGs), which, by the end of the decade, have come to stay as one of the dominant Indian variety of group-based,Informal, institutional structures for the deivery of microfinance.