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VOL. 8, ISSUE 2 (2026)
Legal policy in credit distribution to increase public trust in banking and minimize non-performing loans in Indonesia
Authors
Dinda Risza Riani, Dr. Bambang Slamet Riyadi, Dr. Riza Zulfikar
Abstract
Banks, as financial intermediaries, have the
main function of collecting funds from the public in the form of deposits and
channeling them back in the form of credit. However, credit distribution
activities always come with risks, especially the risk of Non-Performing Loans
(NPL). High levels of NPL can reduce public trust in the banking sector and may
even trigger a wider financial crisis. The paper focused on how do regulation
increase public trust and minimize the NPL using qualitative literature review.
The study suggested the government needs to step in through regulations to
ensure that banks apply the prudential principle in their credit distribution
process and the banks need to implement proper examination before lending the
credit.
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Pages:100-102
How to cite this article:
Dinda Risza Riani, Dr. Bambang Slamet Riyadi, Dr. Riza Zulfikar "Legal policy in credit distribution to increase public trust in banking and minimize non-performing loans in Indonesia". International Journal of Law, Policy and Social Review, Vol 8, Issue 2, 2026, Pages 100-102
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