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INDONESIA. KSP (Cooperative Savings and Loans) and USP (Unit Savings and Loans) are the two forms of savings and loan business as provided for in Article 44 of Law number 25 year 1992 concerning Cooperatives and Government Regulation (PP) number 9 of 1995 on the Implementation of Business Savings and Loans by Cooperatives and the various decisions of the Minister concerning the implementation of instructions by the co-operative savings and loan business.

KSP is a cooperative whose activities only on lending and borrowing. While the USP is a business unit of cooperatives engaged in savings and loans, and managed autonomously as part of the operations of cooperatives concerned.

KSP or USP according to its function is the institute that undertakes the function of collecting and distributing public funds, especially the cooperative members as stipulated in Government Regulation. 9 of 1995. On that basis, the basic rules of the banking system applies here.

The development of KSP / USP can be described through various indicators, such as the number of (cooperative and member) state capital, savings, fund distribution, SHU, and assets.

The presence of KSP as an alternative financial institution that can be accessed by SMEs is necessary, at least remember that formal financial institutions, whether banks or SOEs remains an institution that is difficult to reach by MSEs is not in the physical sense, but in the real meaning; products exist in the form of credit schemes, but the procedures and terms, and komitrnennya difficult. Formal financial institutions have helped foster its customers, for a sense of trauma to the bank, where the MSEs are many but rarely can apply for credit, do not have a negative impact.

The presence of KSP is also expected to encourage the growth of new entrepreneurs, since this group generally has not been touched by the financial institution.

Separation of the KSP USP is intended to: a) develop the services and income cooperative members. b) gain or seize opportunities demand (demand), product savings and credit cooperatives (savings and credit / loans) and offer (supply) of funds from members and the community, including the strengthening of government development funds circulating in the community. c) developing savings and loan finance particularly strong and independent.

Principal argument for the importance of savings and loan USP separation units are: a) the type of cooperative effort to obtain clarity and legal status. b) The business focus is to avoid mixed monetary sector business (KSP-USP) to the business of the real sector (goods and services).

The argument descriptions are as follows:
Juridical
1. Article 16 of Law 25/92
a. Types of cooperatives based on shared activities and interests of member economies.
b. Types of cooperatives include the Cooperative Savings and Loans (KSP), Consumer Cooperatives, Cooperative Producers, Marketing Cooperatives and Cooperative Services.
c. Cooperative Penjenisan developed at this time, such as cooperatives, Cooperative Employees (Kopkar), Kopti, Kopdit, etc.

2. Article 44 of Law 25/92
a. Cooperative can collect funds and channel them through lending and borrowing activity
b. The operations of savings and loans can be executed as one of the business activities of cooperatives (USP) and the only business activities of cooperatives (KSP).
 
So, from the viewpoint of the types of cooperatives, cooperative USP difficult categorized as what kind of cooperative, or not jetas types of cooperatives.

Economic Activity
Economic activity includes the activities of real sector or sectors of goods and services sector also monetary or financial sector.

The real economy needs monetary sector, because the smoothness of the real sector is supported by the monetary sector, so jiga otherwise require monetary sector customers or members of cooperatives or community in the real sector is good. But to be merged into a single management is difficult, because the real sector and monetary sector has different characteristics. Monetary sector / financial manage money input, processing money and produce (output) money. The element of importance is the belief (trusf) and risk (risk).
Thus, by analogy above where KSP-USP as a business in the monetary sector, the USP is not appropriate in combination with other units of the character of real business in the cooperative.

Separation Options
Alternative options or separation (split off) USP into KSP is:
1. Capital weaning. separation gradually. Gradually from USP Cooperative managed separately from other units in the cooperative in question (see article 16, paragraph (4) Regulation no. 9 / 95), then separated KSP with a separate legal entity.
2. Model separation (split off) directly, is the separation of the USP into KSP by KSP new legal entity;
3. Model takeover (acquisition) through the purchase process KSP KSP existing ones, which are sold by their owners.

Separation mechanism is through the USP becomes KSP decision making process of separation (split off) which was decided in the meeting members of the cooperative.

There are a number of obstacles in delivering USP cooperative separation into KSP, among other things:
1. Fundamental Barriers
a. Generally, the USP is the belle of the unit, mainly in: 1) The contribution of income and SHU cooperative. ii) Teaser to attract prospective members of society become cooperative members. iii). Channels for the entry flow (cash in flows) and outside (cash out flows) fund retrofitting / guidance from the government and institute other builder. iv.) Cashier for other units in the cooperative. For example, credit items such as fertilizer / agricultural production means, which managed the production unit. Or credit items that are managed department shop units (Waserda) and others.
b. Status of the debts and part of the solution.
c. The division of wealth between cooperative (old) with KSP (new).

2. Structural Barriers
Matters related to fears of further changes in a). in ownership, b). organizational structure, c). per-rival.

Separation of the KSP USP will bring clarity:
1. Types of cooperatives that manage savings and loan and its legal entity status.
2. Business focus on the financial sector (monetary), not mixed with other units in the cooperative character of the real sector business.

Lack of clarity characteristics are expected to bring significant changes in aspects of a.) the institutional, b) business activities, and c) the process in implementing the savings and loan activities of KSP.
Changes in the more stable this in turn opens opportunities for the KSP, creating excellence in competition in the microfinance market, with: a). excellent service to the members b). develop confidence (trust) and pressing business risks, c). reaching / seeking financing opportunities across sectors, d). and others.