Bank Indonesia (BI) stated that bank lending has begun to improve, although there was still a contraction.

BI Governor Perry Warjiyo said the banking intermediation function was starting to improve, although it was still negative as of May 2021.

"Credit growth is -1.28% YoY in May 2021. This improvement is influenced by improving credit demand, recovery in corporate activity, as well as improvements in the household sector," Perry said in a press conference on the results of the BI Board Governor Meeting on Thursday (17/6).

When compared to the previous month, bank lending experienced an increase. However, BI noted that in April 2021, bank credit contracted by -2.28% YoY.

Furthermore, in the household sector, mortgage loans grew by 6.61% YoY, in line with the implementation of the loan to value (LTV) easing from BI and tax incentives from the government.

BI continues to encourage the momentum for the recovery of the ba