Analysis of the Application of Credit Risk Management in Minimizing Non Performing Loan (Case Study of BPR Artha Kanjuruhan Malang Regency Goverment)

Abstract

This study aims to (1) analyze the implementation of credit risk management at BPR Artha
Kanjuruhan Pemerintahan Kabupaten Malang in 2020-2024 and (2) analyze non-performing
loans at BPR Artha Kanjuruhan Pemerintahan Kabupaten Malang. This study uses a descriptive
qualitative approach, with data collection techniques through interviews and documentation.
The results of the study found that credit risk management at BPR Artha Kanjuruhan Malang
Regency Government has been implemented in accordance with POJK No.13/POJK.03/2015,
which includes active supervision by the board of commissioners and directors, adequate
policies, procedures, and limit setting, as well as risk identification, measurement, and
monitoring. Although credit risk management has been implemented in accordance with
regulations, BPR Artha Kanjuruhan still faces challenges that contribute to the high NPL ratio,
such as external factors like a decline in customer income, misuse of credit funds, changes in
customer characteristics over time, and the end of the restructuring period during the COVID19 pandemic. Internal factors stem from a lack of diligence and insufficient analytical
capabilities on the part of the BPR. To address this, BPR Artha Kanjuruhan has implemented
reorganization and restructuring measures to minimize problem loans.