Is credit profitable? Actually, what are the benefits of credit? To answer these questions, you need to read this article to completion. Ma’am, I am interested in applying for a credit facility at the bank, but before that I want to ask Actually, does the credit benefit me or benefit the Bank? Because to my knowledge, the customer or debtor is charged a certain amount of interest for his credit return, how can it be said to be profitable?
Benefits of the credit facilities that the Bank provides to customers
Fine, thank you, Nando, for the question. I will try to explain about the credit you asked just now. Actually the benefits of credit are a lot, both for you as a debtor, also for banks that provide credit facilities. This is called symbiosis of mutualism, where you receive a loan, and the bank as a lender also benefits.
In addition to these benefits, the state, both the government and the community, also participated in feeling the impact of using your credit. For example, you use a mortgage facility. Well, from your credit, the government clearly gets income in the form of taxes, which can encourage the country’s economic growth.
In addition, with credit, many people can get jobs. Let us discuss more deeply the benefits and benefits of credit from each side, namely from the side of customers, banks, the government and the wider community.
Discussing the Benefits of Credit for State and Broad Communities
Various credit facilities circulating in the community, both productive and consumptive loans, which are spread across the corporate segment ( corporate and commercial ), certain industrial sectors, micro businesses, even consumer loans that are used personally can provide benefits to the government and the wider community .
Generally, companies (both the corporate segment and the micro segment) need credit to fund the development of their businesses, and banks usually provide productive credit for these companies.
In addition, consumer credit is enjoyed more personally by the community in the form of mortgages, motor vehicle ownership loans, credit cards and others. Did you know that the widespread use of credit provides benefits to the state and the wider community?
The benefits of credit for the country and society at large include the following:
Reducing Unemployment Rate
Through the use of credit facilities for companies both in the corporate, commercial and micro business segments, many employment opportunities are created due to the opportunity for the community to create and develop a business. Because there are many jobs created, the unemployment rate will decrease.
In addition, if we imagine further, for a long period of time, if companies that are given credit facilities continue to grow and expand, production levels and market demand increase, and the quality of employee resources continues to be upgraded , then this can affect growth economy of the country.
Can you imagine, the use of credit facilities can even affect a country’s economic growth?
Improve National Development
Bank Indonesia states that banks have the main function as collector and distributor of public funds. The aim is to support the implementation of national development in order to improve equitable development, economic growth, national stability, towards improving the standard of living of the people. Through this statement, it is clear that through the distribution of public funds (credit) national development can be carried out, which leads to improving the living standards of the Indonesian people.
One form of benefits obtained by the state through credit is tax. As discussed earlier, the state receives taxes from outstanding credit. And taxes are one of the country’s biggest revenues that can be used for national development.
Discuss Credit Benefits for Banks
In addition to being beneficial to the state and the wider community, credit facilities also provide benefits for banks providing credit facilities, including:
The Bank Performs Its Function
In general, banks have 3 main functions, namely as agent of trust, agent of service and agent of development .
Let us highlight the function of banks as agents of development, which means banks function as institutions that support the development of national development.
Products and services offered at banks can be divided into 2 major parts, namely funding and lending . Funding is when banks collect funds from the public in the form of savings, current accounts and deposits, while lending is when banks channel funds to the public through credit.
When banks have been able to collect and channel funds and carry out services to the community, meaning banks participate in encouraging national development, banks are carrying out their functions as agents of development .
The concept of reputation is very simple. If there is one friend that you believe uses one of the credit facilities in a bank and feels satisfied, and advises you to use credit facilities at the bank, then surely you will consider using that credit too.
This is one of the benefits obtained by the bank when more credit can be given to many people.
A good reputation is one thing that greatly benefits the bank.
One of the bank’s income is interest income or interest income received through credit. So, the more credit the bank gives, the more interest the bank will receive.
Discuss Credit Benefits for Customers / Debtors
Let’s try to list what credit benefits can be felt by borrowing customers (debtors).
Developing a Debtor Business
For debtors who have businesses and are currently using productive credit facilities from banks, the debtor clearly gets many benefits from the credit facility. Debtors can maintain and develop their business better.
Credit provided by banks also varies, for example for maintenance maintenance of industrial equipment, financing of production, relocation of factories, and financing of business expansion which clearly requires no small amount of funds. You can imagine how much time the debtor needs and how difficult the process is to develop a business if you don’t get a loan from a bank.
Makes It Easy for Debtors to Choose the Right Bank
Usually, banks give credit to debtors who have become customers. Through this, you can use credit facilities while saving at the same bank. You will be easier to pay your credit bill if you save at the same bank. This makes you feel safer and more comfortable in making transactions.
Finance of Protected and Secure Debtors
Have you ever needed anything but your finances did not support you to meet your needs in the near future? You will probably think of repaying your needs by using a credit facility. True, this is one of the benefits of a credit facility, where you can make installments for needs that you cannot pay now, so that your finances remain safe.
You also don’t need to worry that you will forget to pay or your bill is wrong, because the bank will process your credit appropriately. This will make your finances safer and protected from various risks.
Understanding Credit from Different Viewpoints
Such is the explanation that I can convey, Mar Candoy. Hopefully through this explanation, Mar Candoy can better understand the benefits of credit that can be felt by the state, banks and customers. Not only for consumptive credit, but also productive credit.
Do you have other opinions or ideas about the benefits of credit? Please give your comments and opinions about this, thank you.