THE ROLE OF ISLAMIC MICROFINANCE INSTITUTION IN ADDRESSING THE FINANCING OF MEMBERS AFFECTED BY COVID-19: A CASE IN CARUBAN, INDONESIA

Abstract

The purpose of this study is to determine the role of an Islamic Microfinance Institution or BMT Beringharjo Caruban in overcoming the financing of members who were economically affected by Covid-19 and to find out the obstacles and challenges faced during the pandemic. The research method used is descriptive qualitative research. Primary data sources were obtained through interviews with BMT staff. Their members The results of this study indicate that BMT Beringharjo Caruban provides financial relaxation relief to its members. In this case, the affected members paid installments according to their ability each month. Another role is to register all financing members in the government Direct Cash Assistance MSMEs program. However, this study found internal obstacles faced by BMT Beringharjo Caruban during the pandemic, namely the increase in the amount of non-performing financing, the limitation of BMT operating hours at the beginning of the pandemic. The external obstacles faced are that withdrawing and depositing installments in the field does not run optimally due to social distancing and physical distancing policies in several areas where members live. This research finding can be a reference for BMT to prepare long-term strategies in dealing with the impact of Covid-19