With the enactment of Law No. 23 of 1999 on Bank Indonesia which has now been in change by Act No. 3 of 2004, Bank Indonesia’s policy in promoting the development of SMEs have a fairly fundamental paradigm shift because BI can no longer provide financial assistance or loans of Bank Indonesia Liquidity in the development of SMEs become indirect. The approach used to SMEs to shift from development role into promotional role. The approach provides subsidized loans and cheap interest has shifted to a more focused approach on the training to bank staff, research and provision of information. With such conditions, the central bank still gives support, but the BI policy in terms of supply and demand is more focused in order to encourage increased bank intermediation function and to support the banking system is healthy. From the supply side, Bank Indonesia issued a variety of banking policy so as to increase lending to SMEs but tetapprude nt. The policy, among others, by issuing a Bank Indonesia Regulation (PBI) No. No.3/2/PBI/2001 on the granting of 12 Small Business Loans encourage banks to give some credit to small business, PBI No. 6/25/PBI/2004 and SE Number 6/44/DPNP about Commercial Bank’s Business Plan for the Distribution of SME loans, which are known banks in lending commitments SMEs, and SE number 8 / 3/DNP, where in the calculation of risk-weighted assets (RWA) to KUK imposed risk weights of 85 percent.

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