Observation Home With Her Mother Essay - 2467 Words

ANECDOTAL OBSERVATION Child’s name: Lilu Date: 29/11/2016 Setting: Home with her mother Observer: Lauren Macnaught Observation: A child named Lilu is in her playroom with her mother. She is occupied with building blocks of different shapes and numbers in increasing order to make a tower. Meanwhile the child is in constant conversation with her mother seeking approval at every digit of the block, the child is having good identification of the digits. She is totally active and energized to complete the block starting from 1 to 10. The child is responsive towards her mother and is constantly participating in solving the riddle whether she stacked the block linearly in increasing order. The shapes of every cubical blocks were in increasing surfaces due to which the block remain stacked in other bigger blocks which is making the child clueless to the digit 2 and she thinks that it is lost. Interpretation, including developmental skills, concepts and dispositions/links to theory: The child is responsive and kind to her mother. With a silver lining of her identification memory, she is able to identify shapes and digits. But still lacks the logic to fit in the problem solving shoes. The communication skills is in the humour and she is good at it. While the child is not fully lightened socially but more curved toward the parents and teacher affection and care. Relevant Approved Learning Framework Links: Possible future planning: For the purpose of the child’s brain development,Show MoreRelatedEvaluation Of A Professional Social Worker Student Essay1564 Words   |  7 Pagesprotection of observation participants. Consent was given by the guardian of Pia as the guardian understands the observation and interview is for educational purposes only. Pia is 2 years old, with dark hair and eyes and of light brown complexion. Pia lives with her mother and father who are both parents are natives of Guatemala. The family speaks both Spanish and English. Spanish is the language of choice when in the home and English when conversing with Americans. For the sake of the observation and interviewRead MoreEssay on Holistic Biographical Narrative of a Child1180 Words   |  5 PagesIntroduction: In this essay I will be discussing about the observation of a nine month old baby girl called Sarah, who lives with her mother and father in a private home in East London. Her two parents are from different races but were both born in United Kingdom. During the observation Sarah’s mother used very different method to take care of her child. How it was assessed and observed the role her mother placed during the observation. Discussing the child`s physical development, cognitive developmentRead MoreChild Observation Paper1294 Words   |  6 PagesChild Observation Paper Jason Betts Pacific Oaks College November 12, 2012 The purpose of this paper is to discuss and review my observation of a 7 year old African American male who is being raised by his grandmother (45 year old Bi-racial female who has 9 children of her own; 7 of the children are still in the house). During my observation of â€Å"Jackson†, I focused on the following domains of child development: * Physical * Cognitive * Social * Emotional I applied AttachmentRead MoreA Short Note On Individual Student Observation Format Essay962 Words   |  4 PagesAppendix D – Individual Student Observation Format I. Identification of Subject: Age: 6 Race: Caucasian Gender: Male Grade: Kindergarten Location: Observation took place in the student’s home after school. II. Information Sources: Before completing my observation, I spoke to the mother to get a better sense of who the student is. She discussed his accomplishments, strengths, and weaknesses. She also gave me a better understanding of the family dynamic. I also reviewed the child’s report card fromRead MoreMary : A Year Old Female With No Disabilities Essay1576 Words   |  7 Pagesafter school by either her mother or uncle. We are the only people in the house. Mary has two or three homework assignments to complete every afternoon. In addition to homework, we work on supplemental materials provided by me to improve her understanding of the concepts presented in the homework assignments. Tutoring sessions are finished by 4:30pm most afternoons. The setting and times are the same for each of the ABC observations. Permission was obtained from the mother prior to gathering dataRead MoreChild Observation Paper1083 Words   |  5 PagesChild Observation Paper After observing a nine month old child for this Child Observation paper, the author of this paper has taken copious notes during the session. The purpose of this paper is recognizing the biological, cognitive and psychosocial development of the child. The author of this paper identified the background history of the child, the observation made and the development process of the child. BACKGROUND The child chosen for this child observation paper is a nine month old maleRead MoreObservation 1 Physical Development946 Words   |  4 PagesObservation 1 Physical Development Date 9/10/2012 Time 11.00am Number of children present 1 Number of adults present 2 Permission obtained from mother Physical Development: Physical development: The growth and development of the body’s muscles, bones, energy systems, and the nervous system. Description of setting: This observation took place at the TC home. Immediate context: In the main living room there is lots of cushions around the room, there is wooden floors and theRead MoreStrategies For The Study Child788 Words   |  4 Pagesa strong sense of self (identity). Additionally, Annika needs to be supported and exposed to various scenarios that will assist her to make decisions and direct her own play without forcing or dictating to others (abilities). Support strategies for these two aspects will now be discussed. 1. Annika continues to learn through play in order to discover and strengthen her sense of self (identity): Both Annika’s parents have an extremely busy work schedule due to holding such high-regarded roles withinRead MoreYoung Girl With High Functioning Autism That Has Issues With Her Emotions And Effective Communication Essay1225 Words   |  5 Pagesautism that has issues with her emotions and effective communication. For my research, I used observations of the child, interviews with significant people in her life, like her parents and teacher among others, books and the internet. The child can function in an inclusive classroom with the proper guidance and instruction. Introduction I did a case study on a 4 year-old girl with high functioning autism named â€Å"Sabrina Smith†. She has difficulty communicating with her family and peers and often becomesRead MoreMy Observation Of Children During Family Settings981 Words   |  4 PagesDemographics For my observation of children in family settings, I observed my nephew Maison inside his home. This observation occurred on October 24, 2015 from 6:00-8:30. This observation took place in their home on a school day so no major activities in the home were going on at this time. It was an average day for the family where the children were picked up from after school daycare due to the fact that both parents are working. During the observation, Maison’s entire family was home. These included

Lasting Effects of the Holocaust - 1195 Words

The Holocaust not only affected the areas where it took place, it affected the entire world. Even though Jewish people were the main victims in the Holocaust, it also left lasting effects on other groups of people. Both the Nazi and Jewish decedents still feel the aftermath of one of the most horrific counts of genocide that the world has ever encountered. The cries of the victims in concentration camps still ring around the globe today, and they are not easily ignored. Although the Holocaust took place during World War Two, the effects that it had on the world are still prominent today. The Holocaust was a very impressionable period of time. It not only got media attention during that time, but movies, books, websites, and other forms†¦show more content†¦The Holocaust made being proud of oneself a crime. It attacked the Jewish people religion, way of life, and self-pride. They feared for their children’s futures, and their grandchildren’s future. To them, being Jewish wasn’t worth going to concentration camps to fight for their heritage. The Holocaust was one of the first giant acts of genocide. It brought light to the horrific acts of racism that the world still faces today. The Nazi’s were not only trying to destroy Jewish people, they were trying to kill all of the Polish and Roman people as well (HARFF 6). They believed that these types of people were evil and did not deserve to live on the same earth with them. Acts of hate have steamed from the Holocaust and still continue to be an issue today. The Holocaust is often compared to civil rights movements, terrorism, and other acts of hate against a certain group of people or a race of people. Because Hitler inhabited most of Germany with his camps and army so that his genocide would be successful, the Jewish people that got the chance to escape ran to places like Poland and other parts of Europe (GOTTFRIED 3). This brought destruction down upon their places o f refuge. Many countries protected their boarders so that Jewish people could not seek shelter in their homeland and bring death and destruction to their country (GOTTFRIED 4). Hitler created a bad reputation that followed the Jewish people wherever they went, and some countriesShow MoreRelatedThe Holocaust1225 Words   |  5 Pagesï » ¿Sabrina Liu Mrs. Osmonson English 2 8 May 2014 The Holocaust The Holocaust was one of the world’s darkest hours, a mass murder conducted in the shadows of the world’s most deadly war.  The Holocaust also known as Shoah, means a systematic, bureaucratic, state-sponsored persecution and murder of approximately six million Jews during the WWII by German Nazi. Adolf Hitler the leader of Nazis, who afraid Jews would take power over Germans; also, many Germans felt they were mistreated by the lost soRead MoreLastig Effects of the Holocaust1058 Words   |  5 PagesThe Holocaust not only affected the areas where it took place, it affected the entire world. Even though Jewish people were the main victims in the Holocaust, it also left lasting effects on other groups of people. Both, the Nazi and Jewish decedents, still feel the aftermath of one of the most horrific counts of genocide that the world has ever encountered. The cries of the victims in concentration camps still ring around the globe today, and they are not easily ignored . Although the HolocaustRead MoreThe On Coping With The Holocaust Experience1401 Words   |  6 Pagesthrown into chaos because of the Holocaust. Families were ripped apart and values were washed away as citizens were forcefully placed in concentration camps to either be immediately killed or to work until they died. Every person within the camps faced unthinkable trauma. Once everyone was released, the prisoners began to search for lost loved ones and a sense of normality. However, the anguish did not end with the end of the Holocaust. Following the Holocaust, first generation survivors developedRead MoreThe Holocaust And Its Importance1382 Words   |  6 Pages Mrs Keeley ENG 111-4201L 08 April 2016 Remembering The Holocaust and its Importance In history, there has been many important events that were brought about to make the world as we know it today. One of the most important events was world war II. This was a war that had many countries battling each other to try and stop the spread of communism. However, for one country it would have an everlasting impact on their history based on the massacre that happened during that time. Adolf Hitler was a viciousRead MoreAnalysis Of The Book Maus 864 Words   |  4 PagesSpiegalman’s experience to be his best credential. Maus is a graphic novel that depicts basically a cat and mouse representation of the Holocaust. A graphic novel as defined by Webster’s dictionary is a â€Å"fictional story that is presented in comic strip format and published as a book.†(1) Maus tells the story of Spiegelmans father, and his experience as a Jew during the Holocaust. A subtopic within the novel includes Spiegelman interviewing his father, Vladek, and getting him to tell his story. All of theRead MoreMaus And Eden Robinsons Monkey Beach Post Memory1399 Words   |  6 Pages But these experiences were transmitted to them so deeply and affectively as to seem to constitute memories in their own right. (Hirsch 2016) In Maus, Spiegelman uses a third person narrative to tell the story of his father’s experiences in the Holocaust. In contrast, Robinson uses first and second person to tell the story of Lisa Marie’s family’s hardships due to Residential Schools. Through the use of historical references, relationships and evoking emotion in the reader, Eden Robinson’s narrativeRead MoreUnintended Consequences - Israel from Palestine1297 Words   |  6 PagesPity from the Holocaust A common argument for the Holocaust’s causation in the creation of Israel and generous partition of Palestine is the potential for nations to pity the Jews for their suffering. In truth, Zionism wasn’t offered any gains by the Holocaust. Not only was the genocide irrelevant to the argument of Zionism to the rest of the world, but it also couldn’t be pitied, as it was not yet understood. Overall, the Palestine question – and it was just that: a question regarding PalestineRead MoreThe holocaust959 Words   |  4 Pagesï » ¿Year 10 Humanities 2013 Unit 2: World War 2 Task 2 The Holocaust The Causes of the Holocaust The Process of the Holocaust In 1933, the Jewish population of Europe stood at over nine million. Most European Jews lived in countries that Germany would occupy during World War II. By 1945, the Germans killed nearly two out of every three European Jews as part of the Final Solution, the Nazi policy to murder the Jews of Europe. Although Jews, whom the Nazis deemed a priority danger toRead MorePost Traumatic Stress Disorder During The Holocaust Essay1297 Words   |  6 Pages PTSD in Holocaust Survivors The Nazis killed over six million Jews and millions of other Polish and Soviet civilians in the Holocaust. They also killed gypsies, physically and mentally disabled people and homosexuals. The number of survivors today are quickly dwindling down. Clinical psychologist Natan Kellermann defines a Holocaust survivor as any Jew who lived under Nazi occupation and was threatened by the â€Å"final solution† (Kellermann 199). This definition can be applied to not only Jews, butRead MoreAnalysis Of Maus By Art Spiegelman1100 Words   |  5 PagesThe devastating era of the Holocaust will always be remembered from the scars it left behind. The series Maus, written by Art Spiegelman, puts the Holocaust in a different perspective for readers. Vladek Spiegelman, a survivor of the Holocaust told the journey of his survival to his son, Art Spiegelman. Initially, I assumed this graphic novel would be about the racism, torture, and injustice the Jewish faced during the Holocaust by the Ger mans, but the book was more than that. Reading these books

What Constitutes a Good Report free essay sample

At the beginning Before writing a report we need to clear up the target subject and what will be included in this report in order to let your readers easily understand what you want them to get from your report. For example, we all once had the experience of looking for something in a messy drawer. The result is that it is so difficult to find what you want under this condition. In the meantime, you also need to spend lots of time on it. Similarly, presenting an unclear and disorganized report can hardly express your point to the readers. The following is the list which I think a good report must contain: ?Having a proper cover page ?Subheadings (having a topic word or sentence before each paragraph) ? Bullet points ?Making a list ?Highlighting your argument ?Proving your argument ?Using simple words and languages ?Using pinpoint words ?Referencing from ?Having a complete conclusion Below are the reasons why I think the 10 bullet points above form a good and professional report ?Why we need to have a proper cover page in a good report Here I’d like to have you as an example. Like you mentioned in the class before, it is much easier and more convenient for you to organize and categorize different kinds of reports from different departments and classes. You can also save plenty of time on looking for a specific report that you might need. Imagine that if one of your students failed by you come and ask you why you fail him or her, you can immediately find their rubbish reports and show them their disgusting work. It is bloody efficient, isn’t it? A proper cover page should have: 1. Subject 2. Name (who presents the report) . Name (who receives the report) 4. Having the date on it 5. Having company name and department title 6. Should be simple 7. Should be professional 8. Avoiding complicated decoration and designs ?Why we need to use subheadings in our reports I think it is the best way to catch readers’ eyes by using subheadings and once more pull readers into the text. Another important point is that you can get a general idea by only reading the subheadings. If the reader is too busy reading the whole report he or she just need to view the subheadings. How helpful the bullet points are 1. Bullet points help organize information into nuggets 2. It makes reports more manageable. 3. Theyre short and to the main point 4. Theyre easily recognizable 5. They separate facts out in memorable chunks Bullet points have similar functions as the headings. They both save a lot of time for the viewers who are very busy. E. g. Bill Gates receives thousands of reports on his desk every month from all over the world. He would never get to sleep if he needed to read the whole reports. Bullet points and headings can easily help him to select the most important ones and let him work effectively. ?Making a list helps you catch the focal point of a report It really can help you to clear up what you are going to present in a report by writing down all viewpoints that you want to cover in a simple way. It is like a roadmap leading you to the successful destination. ?Highlighting your arguments Life is full of arguments and without arguments we cannot come to a result. Arguments are done on a basis to get the good result out of it hence we need to present the same in a good manner. We need to highlight our arguments so that the reader comes to know about the real facts on which the argument is taken place. ?Proving your arguments You can express your own opinion but you must put forward some substantial evidences to support your arguments, which like the real facts, cases , personal experiences, statistical figures and famous quotations . I think these are the best way to prove our arguments so that the other side person gets convinced from them. ?Using simple words and languages Nowadays the life is to fast and complicated. Everybody needs to complete the work without any trouble. I don’t wish that the person reading my report must get confused in it so the best way is to present my report in a very simple and pleasant way by using a nice and decent language. For example: Our Honorable President Mr. Hu Jintao is very busy man and needs to do lot of work for our loving nation and in that moment while he is reading reports it will be very convenient for him to read it since I have used many simple words with nice language. ?Using pinpoint words In daily life it’s very necessary to use the pinpoint words as because this saves lot of time and gets easy to attract the reader. Pinpointed words give lot of support in your report as because it makes clear your idea the way you present it in front of others. ?Referencing from Nowadays most of the work in daily routine is based on reference. The reference can be socially and or politically. Reference itself means that it can be checked by a relevant source. Reference creates lot of reliability in a work. We can get good information from good references. For example: we always refer to persons in case we need to buy a genuine thing from the market which helps a lot to get a reliable thing in a simple and fastest way. ?Having a complete conclusion connects your keystones again to the reader I don’t think you like to watch a movie or sporty match without an ending. Of course the audience would love to know what the result is. Readers usually read the title, abstract, introduction, and conclusions. In that sense, this section is quite important. You have to crisply state the main take-away points from your work. How has the reader become smarter, or how has the world become a better place because of your work? Another function of conclusion is to let the reader gets a deeper impression on the main and final points of the report. I think conclusion is the best part of the report as it enables to complete it by giving a proper meaning to the complete work done. Conclusion Based on the above, I recommend the following strategy for someone who wants to produce a high-quality report: 1. Check if the title/abstract makes sense, is effective/eye-catching. 2. Are all the relevant questions answered in the introduction? 3. Is the overall structure of the rest of the sections meaningful? 4. Is the difference from related/past work crisp and meaningful? 5. Are the technical sections understandable? Are the figures/tables explained properly? Is the terminology clear? Are the symbols used defined appropriately? 6. Are the results explained properly? Are the conclusions drawn from the graphs/tables sound? Or are there technical holes/flaws? Do the results show how the work presented is better/worse that the other cases of comparison?

The Moon Harsh Mistress Review Essay Example

The Moon Harsh Mistress Review Paper Essay on The Moon Harsh Mistress History repeats itself, and the moon:) Just like always the people who live under the thumb of the ruling class, oppression, deceit. Everything seems to be normal People live everywhere and under all conditions. Another matter is that there are isolated individuals who do not triple this situation of things. Such people generally, and make history. . This energizers, the new engines, even the unknown These are the Crank and appeared on the Moon, where lived Luntik the local people, so to say second generation, born from the criminals. People who have not seen ever planet Earth. In a word Luntik. people are industrious, peaceful but stubborn. One of the main characters of the book is the computer that controls life support on the planet. We will write a custom essay sample on The Moon Harsh Mistress Review specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on The Moon Harsh Mistress Review specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on The Moon Harsh Mistress Review specifically for you FOR ONLY $16.38 $13.9/page Hire Writer He played a major role in the liberation struggle-LUNTIK guerrillas =) It sounds strange , sure. But its fantastic !!! -! Hey, Mike He blinked indicators -. Hey, Man ! Whats new that we have an old it is a loss I know the car is not lost, but do not forget, Mike designed to operate at a shortfall of information and then he himself reprogrammed with an emphasis on literature?. from his quest tear break through. Although, perhaps, at this time he silently shuffled random numbers heuristically line up memory addresses. Mike mused. A wonderful combination of snipe and naive shpenta ushlogo old fart. No insti such as are for (at least I think so) or congenital tendencies or human rears mean experience in the human sense, and the knowledge is greater than that of a platoon luminaries -.. How about hohmochek? I asked -. Go ahead -. What are the similarities between the laser and goldfish About the lasers he knew everything, but where he saw goldfish Oh? a video about them running off, and I ask him such a question in response to my already procured diarrhea ten thousand words -. I do not know. Surrender zaryabilo indicators -. Would be ripe, but can not In the book, all the good it has sustained, consistent, with humor, there sarcasm, irony, self-irony -. full bouquet it has a certain comfort, the spirit, I would say, but for me there there is one but the language we do not forget that it convicts planet means and their speech is rife with thieves catchwords, jargons.!.. . Whats more the whole book to them and based Can I condemn, but I have not read the remaining pages 100 and I gave up, broke still, its not mine..! all these give a damn Well, some of qi. al for starters: I look the baby she has, one little finger she baby. Im fine, 175 seme, and in it 180, as I later learned, all 70 kege mass in front of such parentheses, curly back, and the same fair, like little black little finger. I decided that I must be convoyed out because the local color are rarely blonde in the second and third generations. Face pleasant, almost cute, and a shock of straw-colored curls over all this nice structure. I stopped three feet away, admired and gave a triple fyuit. She took the stand, bowed in gratitude, but not good: know compliments tired My grandfather from Caudle Stone vouched that the moon is the only one in the history of open prison And the guard about the protest rallies are usually not worried. We adhere to the policy of Let him yell. Hipezhu this price it squeak kittens in a box. Although some of the guard instructed ears, and some whipped and mouths plugging, but in the sum of outputs zero program: trivial zero in all respects Well, think for yourself, decide for yourself read or. not read)))))

Break up of a relationship

Isochoric Process Definition and Use

Isochoric Process Definition and Use An isochoric process is a thermodynamic process in which the volume remains constant. Since the volume is constant, the system does no work and W 0. (W is the abbreviation for work.) This is perhaps the easiest of the thermodynamic variables to control since it can be obtained by placing the system in a sealed container which neither expands nor contracts. First Law of Thermodynamics To understand the isochoric process, you need to understand the first law of thermodynamics, which states: The change in a systems internal energy is equal to the difference between heat added to the system from its surroundings and work done by the system on its surroundings. Applying the first law of thermodynamics to this situation, you find that: delta-Since delta-U is the change in internal energy and Q is the heat transfer into or out of the system, you see that all of the heat either comes from internal energy or goes into increasing the internal energy. Constant Volume It is possible to do work on a system without changing the volume, as in the case of stirring a liquid. Some sources use isochoric in these cases to mean zero-work regardless of whether there is a change in volume or not. In most straightforward applications, however, this nuance will not need to be considered- if the volume remains constant throughout the process, it is an isochoric process. Example Calculation The website  Nuclear Power, a free, nonprofit online site built and maintained by engineers, gives an example of a calculation involving the isochoric process. Assume an  isochoric heat addition  in an ideal gas. In an  ideal gas, molecules have no volume and do not interact. According to the  ideal gas law,  pressure  varies linearly with  temperature  and quantity, and inversely with  volume. The basic formula would be: pV nRT where: p  is the absolute pressure of the gasn  is the amount of substanceT  is the absolute temperatureV  is the volumeR  Ã‚  is the ideal, or universal, gas constant equal to the product of the Boltzmann constant  and the Avogadro constantK is the scientific abbreviation for  Kelvin In this equation the symbol R is a constant called the  universal  gas constant  that has the same value for all gases- namely, R   8.31  Joule/mole  K. The isochoric process can be expressed with the ideal gas law as: p/T constant Since the process is  isochoric,  dV   0, the  pressure-volume work is equal to zero. According to the  ideal gas model, the internal energy can be calculated by: ∆U m cv  Ã¢Ë†â€ T where the property  cv  (J/mole K)  is referred to as  specific heat  (or  heat capacity) at a constant volume because under certain special conditions (constant volume) it relates the temperature change of a system to the amount of energy added by heat transfer. Since there is no work done by or on the system, the  first law of thermodynamics  dictates  Ã¢Ë†â€ U ∆Q.  Therefore: Q   m cv  Ã¢Ë†â€ T

Internet Saerver Management Essay Example | Topics and Well Written Essays - 500 words

Internet Saerver Management - Essay Example an e-mail system using technology called web front end, so named because the mail client normally accesses his/her e-mail account utilizing the Internet. It is free for the individual user but several businesses also use the service and Gmail is the most popular web mail, with almost seventy-five million more clients than its nearest competitor, Hotmail. One of the biggest advantages of using web mail is the portability. Whether in Glasgow, Georgia or Guam one does not have to be connected to the office to send and receive mail. Faculty and students of Eilean Muile who travel for research probably find Gmail convenient and easy. The biggest disadvantage is lack of security and is a distinct reason why most Governments specifically forbid web mail for official transmissions. If one wishes to use a stand-alone mail program such as Outlook, by its own website (Google 2012), Google uses both IMAP and POP protocol, although it suggests that one choose IMAP, because of its stability and the fact that â€Å"Unlike POP, IMAP offers two-way communication between your web Gmail and your email client†. On the other hand, mail distributed through a local server, also known as local client, is totally different. With that approach, mail is received, distributed and disseminated on a local server, usually specifically for that purpose. The most popular version is Microsoft Exchange, in partnership with MS Outlook installed on the client computers which is what UHI uses. The mail service is named after the year in which the version was introduced, as is usual for MS applications, and the current version is Exchange Server 2010, although the older versions are still in use worldwide. It is almost used exclusively with Outlook, although Novell Evolution can also be utilized. The advantages include the increased security unavailable on Web clients. Mail can be scrutinized for denial of service attacks and Microsoft claims that Exchange 2010 is the most secure yet and

Competition in Energy Drinks, Sports Drinks and Vitamin-Enhanced Case Study

Competition in Energy Drinks, Sports Drinks and Vitamin-Enhanced Beverages - Case Study Example The commercial attributes of the substitute drinks segment of the industry are different from other groups of drinks. Substitute beverages competed based on differentiation from ancient drinks like carbonated drinks or fruit drinks. In addition, the market began with reduced competition, which later led to abrupt transformation as various new product lines joined and profit margins seriously suffered from reduction of prices. The entire beverage industry face reduced profit margin emanating from increased competition and inability to differentiate their products. The buyers’ negotiation ability and advantage was a significant competitive force. Emerging brands with reduced market shares were highly vulnerable to purchasers’ advantage as storage space was limited whereas top brands had substantial shelf space. Supplier’s advantage and negotiation power represented the weakest force of competition. Several substitute beverage ingredients sellers had to struggle to market their brands. New ingredient suppliers had a relative advantage in bargaining with producers of energy drinks than popular ingredient suppliers. The competition between substitute beverage sellers was the strongest force. Rivalry between key brands centers mainly on the brand reputation, attractive taste, appealing packaging, sales advertisement and promotion, and attaining better shelf space access and reinforcing distribution abilities. Competitive forces that have a substantial impact on attractiveness of industry include substitute beverage brand, reduced switching cots on consumers’ part, aggressiveness and activeness of suppliers’ efforts and a strong focus on endorsements, promotion of sales and advertisements. Â  Beverage market is rapidly changing. The preferences for alternative products are increasing while the preference for traditional drinks decreasing. The driving factors for substitute drink industry involve

Obesity Research Paper Example | Topics and Well Written Essays - 1250 words - 1

Obesity - Research Paper Example There are various studies, which have been conducted on obesity. One of such studies has been conducted by the Agency for Healthcare Research and Quality (AHRQ). According to their study, obesity is associated with a poor quality of life. The quality of life is decreased with an increasing level of obesity. The research has also revealed that the quality of health life of obese people is lower than those with normal weight. Obesity is also associated with a poor health status. It has also been found that obesity results in depression. One of the key mechanisms employed to measure obesity is the Body Mass Index (BMI). BMI is the index of weight for height. It is recognized as the most useful measurement for obesity. Individuals are considered to be obese when their BMI is 30 or more. Historically, obesity was considered only an imbalance between energy intake and energy expenditure. However, the recent research has indicated that there are many factors involved in obesity. There are various genetic, physiological, and behavioral factors that result in obesity. The specific causes of obesity vary among individuals. According to Butland et al. (2007), ‘At the heart of obesity lies a homeostatic biological system that struggles to maintain energy balance to keep the body at a constant weight. This system is not well-adapted to a fast-changing world, where the pace of technological progress has outstripped human evolution’. The researchers now accept that the changes in external environment impact the tendency of individuals to gain or lose weight. Obesity is the accumulation of excess fat in the human body. This condition reduces life expectancy and increase the chance of developing life threatening diseases. One of the most important prevention activities for overcoming obesity is physical activities. The constant exercise could result in an

BPR Microfinance Institution in Indonesia

BPR Microfinance Institution in Indonesia Chapter 1   Introduction 1.1  Background It is believed that microfinance helps low-income people alleviate their life from poverty circumstances in many developing countries. As an economic instrument which has been raised in the middle of seventies, the thought of microfinance came up from the fact that low-income people difficult to access financial services from commercial or formal banking institution which may disadvantage them or even not including them as potential clients. The reason is that, which often we may hear for several times, low-income people lack of collateral for guarantee some amount of money they want, and in the commercial financial institutions point of view it is costly to serve them due to unequal cost-benefit and high transaction cost: low-income people tend to borrow in small amount but the commercial financial institution maintain high cost for processing and assuring their repayment. These costs are not proportional with the amount of loan given to them. A formal microfinance institution existing in Indonesia is the Bank Perkreditan Rakyat/BPR (People’s Credit Bank or Rural Bank)[1] which is established by the Banking Act. The main objective of the BPR is to serve small businesses[2]. It means that BPRs can enhance their role and contribution in the development of micro and small business[3]. In Indonesia, like other developing countries, micro, small and medium enterprises (MSMEs)[4] play significant role in economy. The role of MSMEs can be viewed as an important factor for Indonesia to recover from economic crisis and to lead economic growth and employment. Statistics Indonesia (Badan Pusat Statistik/BPS) and Ministry of Cooperatives and Small-Medium Enterprises reported[5] that, the average contribution of SMEs’ share to total GDP Indonesia from the period of 2001 2007 was 60.77%, while at the same period large enterprises (LEs) contributed 39.23% which can be seen in Table 1. Source:  Statistics Indonesia (BPS) and Ministry of Cooperatives and Small-Medium Enterprises (various editions) In terms of employment creation, MSM enterprises have passed over large enterprises. Table 3 provides worker absorption by types of enterprises. It shows that small enterprises have absorbed approximately 91% of employment during 1999-2006, while medium and large enterprises have provided by 5% and by 4% of employment in Indonesia. Source  : Cooperative Statistics cited in Nazara and Gitaharie (2008), edited by author Based on the data which are discussed in the previous paragraphs, it can be concluded that micro, small and medium enterprises (MSMEs) have a big role and a potential as a driver of the domestic economy. Nevertheless, they still have several constraints, for instance, product market accessibility, lack of management skills, and limited access to financial sources, especially from commercial banks, to meet their demand for finance. A survey conducted by Statistics Indonesia (BPS) concluded that the biggest problem for micro and small enterprises is lack of capital for financing their business.  The survey recognized that  problem in finance for micro enterprises was accounted for 40.48%, while for small enterprises was 36.63% (Wardoyo and Prabowo 2003: 31). In Indonesia, small and medium enterprises can acquire their finance from several sources. According to Nazara and Gitaharie (2008) which refer to statistical data from BPS 2000; 82,960 SMEs got their finance from non banking financial institution; 385,383 SMEs got their finance from banks; and 661,630 SMEs got their finance from other sources. It is clearly from the data that most of SMEs rely on sources other than formal institutions. These figures were not taking into account for SMEs which have no legal entities (Nazara and Gitaharie 2008: 8). From SMEs point of view, they face kinky administrative procedure and also they have to provide collateral as guarantee to get loans from commercial banks. This condition leads SMEs favoring in Bank Perkreditan Rakyat/BPR (People’s Credit Bank or Rural Bank) and other financial institutions which provide simpler in administrative procedures, but higher in interest rates compared to commercial banks (Nazara and Gitaharie 2008: 8). Even though entrepreneurs are burdened with high interest rates, they do not much complain about it as long as they have access to formal credit (Berry et al. 2001 as cited in (Sunarto 2007: 2)). In line with the condition in which SMEs favoring in BPRs, Sunarto (Sunarto 2007: 4) stated that BPRs have several advantages in serving to SMEs, those are: (1) its location which is close to SMEs, (2) simpler in credit procedures, (3) accentuate a personal approach in its services and (4) more flexible.   This paper is focused on the role and contribution of BPR, one of the formal types of microfinance institutions in Indonesia, as the suppliers of funds to different types of enterprises especially to micro and small. The discussion emphasizes on credit allocation delivered by BPRs to the micro, small and medium enterprises. Comparative analysis will be made between commercial banks[6] and BPRs for analytical purposes in two things. Firstly, the comparison in terms of allocation of credit which does not consider other variables playing a role in borrowing, for instance interest rates and so on. The comparative result is not in the amount of the credit disbursed but in the percentage of allocation for each type of enterprise. Secondly, the comparison in terms of performance will be discussed through some indicators. Furthermore, the performance indicators of BPRs will be compared with their criteria which set by Bank Indonesia to see whether those indicators improving or deteriorating. 1.2  Research Objective and Research Questions Research Objective The objective of this paper is to study the role and performance of Bank Perkreditan Rakyat (BPR), as one of microfinance institutions in Indonesia, in financing micro, small and medium enterprises. Research Questions In order to achieve the research objective, this paper proposes research questions as follows: 1.  What is the role of BPRs as supplier of funds to different types of small and medium enterprises, in particular micro enterprises? 2.  What is the performance of BPRs in relation to credit provision to micro and small enterprises? 1.3  Research Hypothesis Bank Perkreditan Rakyat (BPR) was established with the main objective is to serve small-scale business and people in rural areas. Therefore, the first hypothesis is that BPRs are reaching their main objective as supplier of funds to micro, small and medium enterprises as mandated by regulation (i.e., banking act). In order to meet the objectives, it is needed good performances which are reflected from their performance indicators. Therefore, the second hypothesis is that performance indicators of the BPRs have met with the standards which set by the Indonesia banking authority. 1.4  Organization of the Paper This paper is divided into five chapters. Chapter 1 is introduction which contains background of the research, research objective and research questions, research hypothesis, and organization of the paper. Chapter 2 is review of the literatures and analytical framework for the research. Literature reviews discuss about definitions of microfinance and microfinance institution, the approaches can be taken by a microfinance institution in order to serve the clients, the models of microfinance institutions, the types of microfinance institutions in Indonesia and the pyramid of them in relation to potential customers and performance indicators. Analytical framework discusses about the way in which the research will be achieved. Chapter 3 is the microfinance institutions in Indonesia which contains their brief history and recent condition. Chapter 4 is analysis of the role of BPRs in financing micro, small and medium enterprises which contains overview of the chapter, data source for the analysis, methodology of the analysis, some information about commercial banks and BPRs, and analyzing to answer the research questions. Chapter 5 is conclusion.   Chapter 2   Literature Review and Analytical Framework 2.1  Literature Review There are many definitions about microfinance proposed by several researchers and institutions. This paper uses some definitions given by Robinson, Ledgerwood, Consultative Group to Assist the Poor (CGAP), and Asia-Pacific Economic Cooperation (APEC) to describe microfinance. Robinson (Robinson 2001: 9) defined microfinance as small size financial services (mainly saving and credit) given to people who having farm or fish or herd; people who running micro or small enterprises which producing, recycling, repairing or selling goods; people who offering services; people who working for commissions or wages; people who having earnings from renting the land, vehicles, draft animals, or machinery and equipment; and people or other individuals and groups from both rural and urban areas at the local level from the developing countries. Consultative Group to Assist the Poor (CGAP)[7] which uses terminology â€Å"poor people† and Ledgerwood which uses terminology â€Å"low-income clients† pointed out to person who receives basic financial services from microfinance including self-employed people. Furthermore, Ledgerwood (Ledgerwood 1999: 1) stated that definition of microfinance comprises not only in financial intermediation but also in social intermediation. Many of microfinance institutions (MFIs)[8] provide this social intermediation function (i.e., group arrangement, self-confidence development, training to enhance capabilities and to increase capacities in terms of financial literacy and managements) go along with financial intermediation. Moreover, she argued that microfinance is a development instrument and it is not just banking.   Asia-Pacific Economic Cooperation (Santoso et al. 2005: 7) defined microfinance into two understandings. Firstly, it refers to an institution when it designates to an organization which offer financial services or banking products, especially loans to the poor people. Secondly, it uses for different methods or activities which assigned to the poor people in order to access financial services. The poor people usually ask for loans, meanwhile commercial banks do not qualify them for loans. These understandings are close to each other. An institution which provides products for poor people called as microfinance institution. The usage of products (i.e., credits) which is provided by MFIs will be beneficial for poor people in generating more earnings.   Ledgerwood (Ledgerwood 1999: 65-66) stated that the approaches that can be done by microfinance institutions can be divided into two main categories: the minimalist approach or integrated approach. When MFIs do minimalist approach, they only perform functions of financial intermediation, although sometimes they offer social intermediation in limited services. Premise that underlie this approach is a-single missing piece that can be offered by MFIs to the clients in the form of access to credit for them due to the clients are getting less coverage of services from financial institutions, for instance to grow enterprises. On the other hand, integrated approach is a combination of four aspects those are social and financial intermediation, enterprise development and social services. Thus, it is needed a holistic view of the client when a MFI taking this approach. If MFIs are not able to meet all four services, MFIs only offer services that are really needed by the client as long as this service in line with goal and objective of MFIs. Since the large-scale demand for services microfinance activities is in existence, the activities are shown in many countries. The poor people are usually un-bankable, because of such conditions: low skills, poor capacity and severe inabilities. They might not be served in the commercial banking system. It is because the system needs for formal requirements, along with the proper economic scale and certain guarantee. In official terms, this kind of market is un-named and un-served. There are niche markets for the supply of services for MFIs (Santoso et al. 2005: 8). Clients of microfinance institution can not be classified as the poorest of the poor. Generally, they are self-employed and low-income entrepreneur, including; traders, food vendors at the street side, small farmers, small producers and artisan who produce souvenirs in at tourism area and so on. The nature of their business usually provides a stable source of income (Ledgerwood 1999: 2). In various forms, income is provided by micro enterprises owned by the poor. This is done by providing employment. The recycling and repairing better than littering a good, making cheap food, clothing, and transportation to be available are some examples. It is also made to them who are from the low level of formal sector that are usually very difficult to live with their salaries. The people of this kind of life are often can cope with such a problem with the typical cases mentioned above, but can not handle the more serious problem. The other types of problem that are often found are deficiency of capital, skill, official status, and business security. In the meantime, naturally they already have the ability to face sharp business sense, strong life skills, long hard work practice, market knowledge, extensive communication and informal support networks. They also used to have the ability to live supported by their flexibility basic consideration (Robinson 2001: 12). A recent study in Bosnia and Herzegovina carried out by Hartarska and Nadolnyak (Hartarska and Nadolnyak 2008) used the financing constraint approach. The approach states that microenterprises that have good access to credit will be less rely on internal funding in their investment. Using the Living Standards Measurement Survey and the existence of the MFIs in their area, they compare sensitivity of investment to internal funds in the microenterprises which there are MFIs in municipalities they located to microenterprises which there is no MFIs in municipalities they located. They concluded that the MFIs reduce the constraint of microenterprises funding when they are exist close to business. There are some models of microfinance institutions. The first model is Grameen Bank. This model is founded in many countries, especially in Bangladesh, from which it established for the first time by Muhammad Junus. In determining target poor clients, Grameen Bank will do it carefully which is usually done through a series of tests. Loans are given to the group in which each group typically consists of five people and each member of the group guarantee the loan of the other members. This model intensively requires supervision and motivation from the staff to the group borrowers. The second model is Village Bank. An implementing agency establish individual village bank together with 30-50 people and sets capital for on-lending to other members. Repayments of the loan are usually in a week until 16 weeks whereas the village bank pays the principal plus interest to implementing agency. The third model is Credit Unions (CUs). Credit Unions are non-profit financial cooperatives which owned and controlled by its members. Besides saving, CU also provides loans for both productive and non-productive purposes to the members. The membership of CUs compared to Grameen Bank is more heterogeneous and usually based on similar bond. The fourth model is ‘self-help’ groups (SHGs). This model is close to the second model, village bank, although their structure is less well compared to the village bank.  The membership of SHGs is based on the similarity in income and the number of membership approximately 20 people. In principle, they use internal funding, that is saving, to lend it to the members, even though they can also seek external funding as additional source of funds. Several NGOs are facilitating and promoting SHGs, but basically, SHGs are directed as an independent institution. The task of seeking additional financing from outside is usually helped by NGOs which link between SHGs and other external parties or other funding agencies. This NGO’s job close related to social intermediary function they have, while other NGOs are functioned as financial intermediaries which funding SHGs  (Conroy 2003: 4-5). In terms of forms, microfinance institutions can be classified as bank (government and commercial), nonbank financial institution, saving and loan cooperative, credit union and nongovernmental organization. Pawnbrokers, rotating saving and credit association, and moneylender also part of MFIs and hold significant roles in functioning financial intermediation although they are more informal in legal status (Ledgerwood 1999: 1). In Indonesia, several institutions have already served microfinance services for such a long period. Those institutions can be divided into four types. The first type is formal microfinance institutions (MFIs). This type of MFI is regulated and supervised as banking institution and therefore their activities as financial intermediaries subject to banking regulation and supervision. Such institutions included in this type are BRI Unit (state-owned microbank), commercial banks with microfinance services and Rural Bank (Bank Perkreditan Rakyat/BPR). The second type is semi formal MFIs which registered and or licensed by state authorities or local governments, therefore they are not regulated by banking authority (Bank Indonesia). Including in this type are cooperatives, Islamic-based cooperatives (Baitul Maal wat Tamwil/BMT), rural credit institution (Badan Kredit Desa/BKD) and microfinance owned and managed by NGOs. The third type is informal MFIs that operate outside the framework of government regulation, among others, are credit union, rotating credit and saving association (ROSCA), moneylenders, landlords and so on. The fourth type is microcredit programs established by the government in channeling credit to subsidize the poor through a variety of institutions (Nugroho 2008: 181-182). Further explanation about these four microfinance services especially the first three types of MFIs will be presented in chapter 3.   In Figure 1 we can see the pyramid of microfinance institutions with their potential customers in Indonesia. The top layer shows formal MFIs (BRI Unit, Rural Banks/ BPRs and LDKPs). They provide financial services for the top level of microfinance market. This type of MFIs is intended to serve small business which has characterized with stable income flows; therefore these MFIs’ potential clients are non-poor and not so poor people. In the middle layer, semi- formal MFIs serve microfinance services for the poor households. This layer includes rural credit institutions (Bank Kredit Desa/BKD), cooperatives, BMT and NGOs. Clients in this layer are characterized by unstable flow of income. At the bottom layer of the pyramid the huge number of potential clients which need microfinance services. They are very poor people which are characterized by unpredictable income. They need the microfinance services in order to ensure their uncertain income, so they need a small loan to overcom e the difficulties of life (Nugroho 2008: 184-185). Figure 1: The Pyramid of Microfinance Services in Indonesia Source: BI and GTZ (2000) cited in Nugroho (2008) As mentioned above, Rural Bank (Bank Perkreditan Rakyat/BPR) is one of the formal types of microfinance in Indonesia. Its existence is established by Banking Act number 7 of 1992 as amended by Banking Act number 10 of 1998. The main goal of the rural bank is to serve small business and rural communities. In order to deliver their services to the customers, a microfinance institution requires a good performance. This performance can be seen from some indicators. Looking at these indicators, we can decide how well they not only can do financially but also it can also build the future performance goals. There are a large number of performance indicators that can be used by MFIs in measuring the financial performance. One of the principles that can be used is the CAMEL system, ACCION. This system examines five traditional aspects which are regarded as the most important thing in the practices of the financial intermediaries. The five aspects (capital adequacy, asset quality, management, earnings, and liquidity) be the sign of the financial condition and operational strength of the MFI in common (Ledgerwood 1999: 205,227,229). 2.2  Analytical Framework Based on the theoretical framework that has been presented in the previous section, the author uses Figure 2 below describing the analytical framework used in the research which answering the research questions asked. There are two parties involved in the financial market.  On one hand, there is a supply side which is financial institutions that act as financial intermediation agents or it might be function as other than financial intermediation like social intermediation or something else. These financial institutions include commercial banks, non-banks financial institutions (insurances company, ventura capital, etc), and microfinance institutions (in different types and forms). On the other hand, on the demand side, there are some parties that require financing for different purposes, among others for working capital and investment usage which is belongs to micro, small and medium enterprises (MSMEs). The problem is that not all of these financial institutions allow MSMEs as their client due to several requirements which can not be fulfilled by MSMEs (collateral and bureaucratic procedures, for instances) or it might be comes from the MSMEs itself that no need too much funds (small financing). Here, microfinance institutions fit with the need of MSMEs. The mechanism then runs as common supply and demand in the market: MFIs, as financial intermediaries, offer credit or loan to MSMEs. Furthermore, MSMEs use the loan for running their operational activities (working capital usage) or for accumulating their physical capital (investment usage). At the end of the story, output of MSMEs will contribute to national income (GDP) and at the same time generates income for the owners and employees. Figure 2: Analytical Framework of the Research: Supply and Demand in Financial Market Source: author’s graph This paper focuses on the supply side of particular financial intermediaries in the financial market those are microfinance institutions. In other words, using Ledgerwood’s terminology mentioned in literature review, the paper mainly looks at the role of MFIs in terms of â€Å"minimalist approach†; how they perform as financial intermediations in delivering credit or loan. Special attention given to Rural Banks, one of formal MFIs in Indonesia in allocating their credit to different types of enterprises such as micro, small, medium and large enterprises. There are several reasons why this paper discusses on Rural Banks as unit of analysis. Firstly, it is states in the regulation (Banking Act) that the main objective of Rural Banks is to serve small scale business and looking into the pyramid of MFIs appeared in Figure 1. It means that Rural Banks have a specialization as small scale business’ banking, especially micro enterprises. This paper wants to see to which extent this mission is successfully executed. Secondly, Rural Banks are the second largest microfinance institutions in terms of asset, third party funds collected and number of debtors. According to Bank Indonesia (2008)[9], they posses 35% of total MFIs’ assets; 30.43% of third party funds collected on total MFIs and 29.15% of total number debtors on total MFIs.   This study proposes two research questions. The first research question relates to the role of rural banks as financial intermediaries in delivering credit to different types of business especially micro and small enterprises. In addressing the first research question, the paper uses comparative analysis and simple calculations in terms of credit disbursement for both commercial banks and rural banks so that the share (percentage) of credit allocation to different types of enterprises to be known. In order to obtain the result, some criteria and assumption are applied in the study. This is done due to there is no data available about the definite amount of credit disbursed by either Rural Banks or commercial banks to different type of enterprises. The discussion focuses only on the amount of credit allocation, so that other variables that determine the credit such as interest rate, collateral, and so forth are not discussed in this study.   The second research question indicates the performance indicators of rural banks in relation to credit provision to micro enterprises. These indicators include; Loan to Deposit Ratio (LDR), Returns on Assets Ratio (ROA) and Non-Performing Loan Ratio (NPL) which refer to Director of Bank Indonesia Decree number 30/12/Kep/Dir and Bank Indonesia’s Letter No. 30/3/UPPB about Rural Banks Soundness Evaluation. Furthermore, comparison will be made between these indicators and criteria. Chapter 3 Microfinance Institutions in Indonesia 3.1  Microfinance Institutions in Indonesia As developing country, Indonesia has long experience and history in developing microfinance institution which has made it possible for poor or low-income people to overcome financial constraints and to access financial institutions. For this condition, some researchers like Berenbach and Churchill called that Indonesia is â€Å"the most developed market for microfinance services in the world† (Barenbach and Churchill 1997 as cited in (Santoso et al. 2005: 43)). The development of microfinance institution began for the first time in Dutch colonial era when several well-educated local people saw deteriorating economy happened in their community and they looked for the need of this services and started organize it. The two famous institutions best known as pioneer in microfinance institutions and exist since colonial era are cooperative and Bank Rakyat Indonesia (BRI). As mentioned in chapter 2, microfinance institutions in Indonesia can be classified into four types (Nugroho 2008), those are; formal microfinance institutions, semiformal MFIs, informal MFIs and microcredit program which is established by the government for delivering credit to poor people through several institutions. In this chapter the latter type of MFI will not be discussed. The discussion is emphasizes on three other institutions. Formal MFIs are financial intermediary institutions which refer and subject to banking regulation and therefore supervised by Bank Indonesia. Semiformal MFIs are not regulated by Bank Indonesia as a banking authority, but they are licensed and or registered by other state authorities or local government. Informal MFIs operate outside government regulations. Nugroho (Nugroho 2008) described institutions which include in each type of MFI as follows: formal MFIs including BRI Unit, Rural Bank (BPR) and The Rural Credit Fund Institutions (Lembaga Dana Kredit Pedesaan/LDKP); semiformal MFIs covering rural credit institution (Badan Kredit Desa/ BKD), microfinance NGO, credit cooperatives including Islamic-based cooperatives (Baitul Maal wat Tamwil/BMT); informal MFIs including credit unions, rotating credit and saving association (ROSCA), moneylenders, traders and landlords. Table 3.1 provides map of microfinance institutions by types in Indonesia in terms of units and their financial services. Bank Rakyat Indonesia Unit Lembaga Dana Kredit Perdesaan (LDKP) – The Rural Credit Fund Institutions The Rural Credit Fund Institutions (LDKP) is the term of credit fund institution that operates in rural area, including a variety of non bank microfinance institutions with different names, ownership, organization, services and outreach, that was established on initiatives of provincial government. LDKP belongs to provincial, district or village government which, in their operation, have to obtain license from and was regulated by provincial government within the national regulatory framework. they get technical support and supervision from regional development bank (BPD) which are owned by provincial government.. since it was established in 1970s, the number of LDKP getting less from 1978 to 630 in 2000, this decrease due to the conversion of LDKP to peoples cerdit banks(BPR) and recently only about one quarter of LDKP  have become banks. The Badan  Kredit Desa (BKD) BKD is a profitable and sustainable village level financial institution that provide financial services with a outreach to low income people. it was operated by a committee that controlled by head of village and have sustained the operation since colonial era. On behalf of Bank Indonesia, BRI branch offices supervise and provide technical assistance  for BKD. in 1970s indonesian government did not pay much attention to this system. instead, the government  give more attention to the cooperative system. this make hard for BKD system to developed. in 1990s BRI tried to revive BKD by providing basic capital, improving administrative system and introducing new saving instruments, however, 1992 banking act burden the expanding BKD system. BKD is recognized as peoples credit bank (BPR) and has been operating as a licensed and regulated bank  since 1992 banking act but the frame work setting, supervision and technical assistance has not changed since 2000. Cooperatives Here, the brief history of cooperative in Indonesia refers to Santoso et al (2005) and Ministry of Cooperative, Small and Medium Enterprises’ website (www.depkop.go.id, 2009) as references. The thought of cooperative was delivered for the first time by Patih R. Aria Wiriatmaja at Purwokerto, a small town in Central Java, in 1896. Then, De Wolffvan Westerrode continued his efforts. In 1908, the year of national movement, Dr. Sutomo founded Budi Utomo which played a significant role for cooperatives improving the life of society. Then, Verordening op de Cooperatieve Vereeniging was established. Twelve years after that, in 1927, another type of cooperative called Regelling Inlandsche Cooperatieve was launched. In the same year, to develop bargaining power among local entrepreneurs, Islamic Trader Union (Serikat Dagang Islam) was established. Indonesian National Party (Partai Nasional Indonesia) which had activities in promoting cooperative spirit was established in 1929. 3.2  Bank Perkreditan Rakyat (BPR) Brief History Steinwand (Steinwand 2001) provided detail periodical history about Rural Bank. He divided the history into four parts of periods; the evolution of the colonial BPR (1895-1945), the period from independence to financial sector reform (1945-1983), the period from financial sector reform to financial crisis (1983-1999) and at the present condition. Rural Bank Position in Financial System in Indonesia Chapter 4   Analysis of the Role of Bank Perkreditan Rakyat (BPR) in Financing Micro, Small and Medium Enterprises 4.1  Overview Chapter 4 consists of 6 sections which each section aimed to answer the research questions. Section 1 is a general information about what will be discussed in this chapter; section 2 discusses about the source of the data used in the analysis; section 3 is the methodology; section 4 is about overview the condition of Bank Perkreditan Rakyat (BPRs) and commercial banks (CBs) in Indonesia using selected indicators, third party funds and credits; section 5 tries to reply the first research question by using comparative analysis between commercial banks and BPRs; and section 6 is the last section which answering the second research question about the performance indicators of BPR Microfinance Institution in Indonesia BPR Microfinance Institution in Indonesia Chapter 1   Introduction 1.1  Background It is believed that microfinance helps low-income people alleviate their life from poverty circumstances in many developing countries. As an economic instrument which has been raised in the middle of seventies, the thought of microfinance came up from the fact that low-income people difficult to access financial services from commercial or formal banking institution which may disadvantage them or even not including them as potential clients. The reason is that, which often we may hear for several times, low-income people lack of collateral for guarantee some amount of money they want, and in the commercial financial institutions point of view it is costly to serve them due to unequal cost-benefit and high transaction cost: low-income people tend to borrow in small amount but the commercial financial institution maintain high cost for processing and assuring their repayment. These costs are not proportional with the amount of loan given to them. A formal microfinance institution existing in Indonesia is the Bank Perkreditan Rakyat/BPR (People’s Credit Bank or Rural Bank)[1] which is established by the Banking Act. The main objective of the BPR is to serve small businesses[2]. It means that BPRs can enhance their role and contribution in the development of micro and small business[3]. In Indonesia, like other developing countries, micro, small and medium enterprises (MSMEs)[4] play significant role in economy. The role of MSMEs can be viewed as an important factor for Indonesia to recover from economic crisis and to lead economic growth and employment. Statistics Indonesia (Badan Pusat Statistik/BPS) and Ministry of Cooperatives and Small-Medium Enterprises reported[5] that, the average contribution of SMEs’ share to total GDP Indonesia from the period of 2001 2007 was 60.77%, while at the same period large enterprises (LEs) contributed 39.23% which can be seen in Table 1. Source:  Statistics Indonesia (BPS) and Ministry of Cooperatives and Small-Medium Enterprises (various editions) In terms of employment creation, MSM enterprises have passed over large enterprises. Table 3 provides worker absorption by types of enterprises. It shows that small enterprises have absorbed approximately 91% of employment during 1999-2006, while medium and large enterprises have provided by 5% and by 4% of employment in Indonesia. Source  : Cooperative Statistics cited in Nazara and Gitaharie (2008), edited by author Based on the data which are discussed in the previous paragraphs, it can be concluded that micro, small and medium enterprises (MSMEs) have a big role and a potential as a driver of the domestic economy. Nevertheless, they still have several constraints, for instance, product market accessibility, lack of management skills, and limited access to financial sources, especially from commercial banks, to meet their demand for finance. A survey conducted by Statistics Indonesia (BPS) concluded that the biggest problem for micro and small enterprises is lack of capital for financing their business.  The survey recognized that  problem in finance for micro enterprises was accounted for 40.48%, while for small enterprises was 36.63% (Wardoyo and Prabowo 2003: 31). In Indonesia, small and medium enterprises can acquire their finance from several sources. According to Nazara and Gitaharie (2008) which refer to statistical data from BPS 2000; 82,960 SMEs got their finance from non banking financial institution; 385,383 SMEs got their finance from banks; and 661,630 SMEs got their finance from other sources. It is clearly from the data that most of SMEs rely on sources other than formal institutions. These figures were not taking into account for SMEs which have no legal entities (Nazara and Gitaharie 2008: 8). From SMEs point of view, they face kinky administrative procedure and also they have to provide collateral as guarantee to get loans from commercial banks. This condition leads SMEs favoring in Bank Perkreditan Rakyat/BPR (People’s Credit Bank or Rural Bank) and other financial institutions which provide simpler in administrative procedures, but higher in interest rates compared to commercial banks (Nazara and Gitaharie 2008: 8). Even though entrepreneurs are burdened with high interest rates, they do not much complain about it as long as they have access to formal credit (Berry et al. 2001 as cited in (Sunarto 2007: 2)). In line with the condition in which SMEs favoring in BPRs, Sunarto (Sunarto 2007: 4) stated that BPRs have several advantages in serving to SMEs, those are: (1) its location which is close to SMEs, (2) simpler in credit procedures, (3) accentuate a personal approach in its services and (4) more flexible.   This paper is focused on the role and contribution of BPR, one of the formal types of microfinance institutions in Indonesia, as the suppliers of funds to different types of enterprises especially to micro and small. The discussion emphasizes on credit allocation delivered by BPRs to the micro, small and medium enterprises. Comparative analysis will be made between commercial banks[6] and BPRs for analytical purposes in two things. Firstly, the comparison in terms of allocation of credit which does not consider other variables playing a role in borrowing, for instance interest rates and so on. The comparative result is not in the amount of the credit disbursed but in the percentage of allocation for each type of enterprise. Secondly, the comparison in terms of performance will be discussed through some indicators. Furthermore, the performance indicators of BPRs will be compared with their criteria which set by Bank Indonesia to see whether those indicators improving or deteriorating. 1.2  Research Objective and Research Questions Research Objective The objective of this paper is to study the role and performance of Bank Perkreditan Rakyat (BPR), as one of microfinance institutions in Indonesia, in financing micro, small and medium enterprises. Research Questions In order to achieve the research objective, this paper proposes research questions as follows: 1.  What is the role of BPRs as supplier of funds to different types of small and medium enterprises, in particular micro enterprises? 2.  What is the performance of BPRs in relation to credit provision to micro and small enterprises? 1.3  Research Hypothesis Bank Perkreditan Rakyat (BPR) was established with the main objective is to serve small-scale business and people in rural areas. Therefore, the first hypothesis is that BPRs are reaching their main objective as supplier of funds to micro, small and medium enterprises as mandated by regulation (i.e., banking act). In order to meet the objectives, it is needed good performances which are reflected from their performance indicators. Therefore, the second hypothesis is that performance indicators of the BPRs have met with the standards which set by the Indonesia banking authority. 1.4  Organization of the Paper This paper is divided into five chapters. Chapter 1 is introduction which contains background of the research, research objective and research questions, research hypothesis, and organization of the paper. Chapter 2 is review of the literatures and analytical framework for the research. Literature reviews discuss about definitions of microfinance and microfinance institution, the approaches can be taken by a microfinance institution in order to serve the clients, the models of microfinance institutions, the types of microfinance institutions in Indonesia and the pyramid of them in relation to potential customers and performance indicators. Analytical framework discusses about the way in which the research will be achieved. Chapter 3 is the microfinance institutions in Indonesia which contains their brief history and recent condition. Chapter 4 is analysis of the role of BPRs in financing micro, small and medium enterprises which contains overview of the chapter, data source for the analysis, methodology of the analysis, some information about commercial banks and BPRs, and analyzing to answer the research questions. Chapter 5 is conclusion.   Chapter 2   Literature Review and Analytical Framework 2.1  Literature Review There are many definitions about microfinance proposed by several researchers and institutions. This paper uses some definitions given by Robinson, Ledgerwood, Consultative Group to Assist the Poor (CGAP), and Asia-Pacific Economic Cooperation (APEC) to describe microfinance. Robinson (Robinson 2001: 9) defined microfinance as small size financial services (mainly saving and credit) given to people who having farm or fish or herd; people who running micro or small enterprises which producing, recycling, repairing or selling goods; people who offering services; people who working for commissions or wages; people who having earnings from renting the land, vehicles, draft animals, or machinery and equipment; and people or other individuals and groups from both rural and urban areas at the local level from the developing countries. Consultative Group to Assist the Poor (CGAP)[7] which uses terminology â€Å"poor people† and Ledgerwood which uses terminology â€Å"low-income clients† pointed out to person who receives basic financial services from microfinance including self-employed people. Furthermore, Ledgerwood (Ledgerwood 1999: 1) stated that definition of microfinance comprises not only in financial intermediation but also in social intermediation. Many of microfinance institutions (MFIs)[8] provide this social intermediation function (i.e., group arrangement, self-confidence development, training to enhance capabilities and to increase capacities in terms of financial literacy and managements) go along with financial intermediation. Moreover, she argued that microfinance is a development instrument and it is not just banking.   Asia-Pacific Economic Cooperation (Santoso et al. 2005: 7) defined microfinance into two understandings. Firstly, it refers to an institution when it designates to an organization which offer financial services or banking products, especially loans to the poor people. Secondly, it uses for different methods or activities which assigned to the poor people in order to access financial services. The poor people usually ask for loans, meanwhile commercial banks do not qualify them for loans. These understandings are close to each other. An institution which provides products for poor people called as microfinance institution. The usage of products (i.e., credits) which is provided by MFIs will be beneficial for poor people in generating more earnings.   Ledgerwood (Ledgerwood 1999: 65-66) stated that the approaches that can be done by microfinance institutions can be divided into two main categories: the minimalist approach or integrated approach. When MFIs do minimalist approach, they only perform functions of financial intermediation, although sometimes they offer social intermediation in limited services. Premise that underlie this approach is a-single missing piece that can be offered by MFIs to the clients in the form of access to credit for them due to the clients are getting less coverage of services from financial institutions, for instance to grow enterprises. On the other hand, integrated approach is a combination of four aspects those are social and financial intermediation, enterprise development and social services. Thus, it is needed a holistic view of the client when a MFI taking this approach. If MFIs are not able to meet all four services, MFIs only offer services that are really needed by the client as long as this service in line with goal and objective of MFIs. Since the large-scale demand for services microfinance activities is in existence, the activities are shown in many countries. The poor people are usually un-bankable, because of such conditions: low skills, poor capacity and severe inabilities. They might not be served in the commercial banking system. It is because the system needs for formal requirements, along with the proper economic scale and certain guarantee. In official terms, this kind of market is un-named and un-served. There are niche markets for the supply of services for MFIs (Santoso et al. 2005: 8). Clients of microfinance institution can not be classified as the poorest of the poor. Generally, they are self-employed and low-income entrepreneur, including; traders, food vendors at the street side, small farmers, small producers and artisan who produce souvenirs in at tourism area and so on. The nature of their business usually provides a stable source of income (Ledgerwood 1999: 2). In various forms, income is provided by micro enterprises owned by the poor. This is done by providing employment. The recycling and repairing better than littering a good, making cheap food, clothing, and transportation to be available are some examples. It is also made to them who are from the low level of formal sector that are usually very difficult to live with their salaries. The people of this kind of life are often can cope with such a problem with the typical cases mentioned above, but can not handle the more serious problem. The other types of problem that are often found are deficiency of capital, skill, official status, and business security. In the meantime, naturally they already have the ability to face sharp business sense, strong life skills, long hard work practice, market knowledge, extensive communication and informal support networks. They also used to have the ability to live supported by their flexibility basic consideration (Robinson 2001: 12). A recent study in Bosnia and Herzegovina carried out by Hartarska and Nadolnyak (Hartarska and Nadolnyak 2008) used the financing constraint approach. The approach states that microenterprises that have good access to credit will be less rely on internal funding in their investment. Using the Living Standards Measurement Survey and the existence of the MFIs in their area, they compare sensitivity of investment to internal funds in the microenterprises which there are MFIs in municipalities they located to microenterprises which there is no MFIs in municipalities they located. They concluded that the MFIs reduce the constraint of microenterprises funding when they are exist close to business. There are some models of microfinance institutions. The first model is Grameen Bank. This model is founded in many countries, especially in Bangladesh, from which it established for the first time by Muhammad Junus. In determining target poor clients, Grameen Bank will do it carefully which is usually done through a series of tests. Loans are given to the group in which each group typically consists of five people and each member of the group guarantee the loan of the other members. This model intensively requires supervision and motivation from the staff to the group borrowers. The second model is Village Bank. An implementing agency establish individual village bank together with 30-50 people and sets capital for on-lending to other members. Repayments of the loan are usually in a week until 16 weeks whereas the village bank pays the principal plus interest to implementing agency. The third model is Credit Unions (CUs). Credit Unions are non-profit financial cooperatives which owned and controlled by its members. Besides saving, CU also provides loans for both productive and non-productive purposes to the members. The membership of CUs compared to Grameen Bank is more heterogeneous and usually based on similar bond. The fourth model is ‘self-help’ groups (SHGs). This model is close to the second model, village bank, although their structure is less well compared to the village bank.  The membership of SHGs is based on the similarity in income and the number of membership approximately 20 people. In principle, they use internal funding, that is saving, to lend it to the members, even though they can also seek external funding as additional source of funds. Several NGOs are facilitating and promoting SHGs, but basically, SHGs are directed as an independent institution. The task of seeking additional financing from outside is usually helped by NGOs which link between SHGs and other external parties or other funding agencies. This NGO’s job close related to social intermediary function they have, while other NGOs are functioned as financial intermediaries which funding SHGs  (Conroy 2003: 4-5). In terms of forms, microfinance institutions can be classified as bank (government and commercial), nonbank financial institution, saving and loan cooperative, credit union and nongovernmental organization. Pawnbrokers, rotating saving and credit association, and moneylender also part of MFIs and hold significant roles in functioning financial intermediation although they are more informal in legal status (Ledgerwood 1999: 1). In Indonesia, several institutions have already served microfinance services for such a long period. Those institutions can be divided into four types. The first type is formal microfinance institutions (MFIs). This type of MFI is regulated and supervised as banking institution and therefore their activities as financial intermediaries subject to banking regulation and supervision. Such institutions included in this type are BRI Unit (state-owned microbank), commercial banks with microfinance services and Rural Bank (Bank Perkreditan Rakyat/BPR). The second type is semi formal MFIs which registered and or licensed by state authorities or local governments, therefore they are not regulated by banking authority (Bank Indonesia). Including in this type are cooperatives, Islamic-based cooperatives (Baitul Maal wat Tamwil/BMT), rural credit institution (Badan Kredit Desa/BKD) and microfinance owned and managed by NGOs. The third type is informal MFIs that operate outside the framework of government regulation, among others, are credit union, rotating credit and saving association (ROSCA), moneylenders, landlords and so on. The fourth type is microcredit programs established by the government in channeling credit to subsidize the poor through a variety of institutions (Nugroho 2008: 181-182). Further explanation about these four microfinance services especially the first three types of MFIs will be presented in chapter 3.   In Figure 1 we can see the pyramid of microfinance institutions with their potential customers in Indonesia. The top layer shows formal MFIs (BRI Unit, Rural Banks/ BPRs and LDKPs). They provide financial services for the top level of microfinance market. This type of MFIs is intended to serve small business which has characterized with stable income flows; therefore these MFIs’ potential clients are non-poor and not so poor people. In the middle layer, semi- formal MFIs serve microfinance services for the poor households. This layer includes rural credit institutions (Bank Kredit Desa/BKD), cooperatives, BMT and NGOs. Clients in this layer are characterized by unstable flow of income. At the bottom layer of the pyramid the huge number of potential clients which need microfinance services. They are very poor people which are characterized by unpredictable income. They need the microfinance services in order to ensure their uncertain income, so they need a small loan to overcom e the difficulties of life (Nugroho 2008: 184-185). Figure 1: The Pyramid of Microfinance Services in Indonesia Source: BI and GTZ (2000) cited in Nugroho (2008) As mentioned above, Rural Bank (Bank Perkreditan Rakyat/BPR) is one of the formal types of microfinance in Indonesia. Its existence is established by Banking Act number 7 of 1992 as amended by Banking Act number 10 of 1998. The main goal of the rural bank is to serve small business and rural communities. In order to deliver their services to the customers, a microfinance institution requires a good performance. This performance can be seen from some indicators. Looking at these indicators, we can decide how well they not only can do financially but also it can also build the future performance goals. There are a large number of performance indicators that can be used by MFIs in measuring the financial performance. One of the principles that can be used is the CAMEL system, ACCION. This system examines five traditional aspects which are regarded as the most important thing in the practices of the financial intermediaries. The five aspects (capital adequacy, asset quality, management, earnings, and liquidity) be the sign of the financial condition and operational strength of the MFI in common (Ledgerwood 1999: 205,227,229). 2.2  Analytical Framework Based on the theoretical framework that has been presented in the previous section, the author uses Figure 2 below describing the analytical framework used in the research which answering the research questions asked. There are two parties involved in the financial market.  On one hand, there is a supply side which is financial institutions that act as financial intermediation agents or it might be function as other than financial intermediation like social intermediation or something else. These financial institutions include commercial banks, non-banks financial institutions (insurances company, ventura capital, etc), and microfinance institutions (in different types and forms). On the other hand, on the demand side, there are some parties that require financing for different purposes, among others for working capital and investment usage which is belongs to micro, small and medium enterprises (MSMEs). The problem is that not all of these financial institutions allow MSMEs as their client due to several requirements which can not be fulfilled by MSMEs (collateral and bureaucratic procedures, for instances) or it might be comes from the MSMEs itself that no need too much funds (small financing). Here, microfinance institutions fit with the need of MSMEs. The mechanism then runs as common supply and demand in the market: MFIs, as financial intermediaries, offer credit or loan to MSMEs. Furthermore, MSMEs use the loan for running their operational activities (working capital usage) or for accumulating their physical capital (investment usage). At the end of the story, output of MSMEs will contribute to national income (GDP) and at the same time generates income for the owners and employees. Figure 2: Analytical Framework of the Research: Supply and Demand in Financial Market Source: author’s graph This paper focuses on the supply side of particular financial intermediaries in the financial market those are microfinance institutions. In other words, using Ledgerwood’s terminology mentioned in literature review, the paper mainly looks at the role of MFIs in terms of â€Å"minimalist approach†; how they perform as financial intermediations in delivering credit or loan. Special attention given to Rural Banks, one of formal MFIs in Indonesia in allocating their credit to different types of enterprises such as micro, small, medium and large enterprises. There are several reasons why this paper discusses on Rural Banks as unit of analysis. Firstly, it is states in the regulation (Banking Act) that the main objective of Rural Banks is to serve small scale business and looking into the pyramid of MFIs appeared in Figure 1. It means that Rural Banks have a specialization as small scale business’ banking, especially micro enterprises. This paper wants to see to which extent this mission is successfully executed. Secondly, Rural Banks are the second largest microfinance institutions in terms of asset, third party funds collected and number of debtors. According to Bank Indonesia (2008)[9], they posses 35% of total MFIs’ assets; 30.43% of third party funds collected on total MFIs and 29.15% of total number debtors on total MFIs.   This study proposes two research questions. The first research question relates to the role of rural banks as financial intermediaries in delivering credit to different types of business especially micro and small enterprises. In addressing the first research question, the paper uses comparative analysis and simple calculations in terms of credit disbursement for both commercial banks and rural banks so that the share (percentage) of credit allocation to different types of enterprises to be known. In order to obtain the result, some criteria and assumption are applied in the study. This is done due to there is no data available about the definite amount of credit disbursed by either Rural Banks or commercial banks to different type of enterprises. The discussion focuses only on the amount of credit allocation, so that other variables that determine the credit such as interest rate, collateral, and so forth are not discussed in this study.   The second research question indicates the performance indicators of rural banks in relation to credit provision to micro enterprises. These indicators include; Loan to Deposit Ratio (LDR), Returns on Assets Ratio (ROA) and Non-Performing Loan Ratio (NPL) which refer to Director of Bank Indonesia Decree number 30/12/Kep/Dir and Bank Indonesia’s Letter No. 30/3/UPPB about Rural Banks Soundness Evaluation. Furthermore, comparison will be made between these indicators and criteria. Chapter 3 Microfinance Institutions in Indonesia 3.1  Microfinance Institutions in Indonesia As developing country, Indonesia has long experience and history in developing microfinance institution which has made it possible for poor or low-income people to overcome financial constraints and to access financial institutions. For this condition, some researchers like Berenbach and Churchill called that Indonesia is â€Å"the most developed market for microfinance services in the world† (Barenbach and Churchill 1997 as cited in (Santoso et al. 2005: 43)). The development of microfinance institution began for the first time in Dutch colonial era when several well-educated local people saw deteriorating economy happened in their community and they looked for the need of this services and started organize it. The two famous institutions best known as pioneer in microfinance institutions and exist since colonial era are cooperative and Bank Rakyat Indonesia (BRI). As mentioned in chapter 2, microfinance institutions in Indonesia can be classified into four types (Nugroho 2008), those are; formal microfinance institutions, semiformal MFIs, informal MFIs and microcredit program which is established by the government for delivering credit to poor people through several institutions. In this chapter the latter type of MFI will not be discussed. The discussion is emphasizes on three other institutions. Formal MFIs are financial intermediary institutions which refer and subject to banking regulation and therefore supervised by Bank Indonesia. Semiformal MFIs are not regulated by Bank Indonesia as a banking authority, but they are licensed and or registered by other state authorities or local government. Informal MFIs operate outside government regulations. Nugroho (Nugroho 2008) described institutions which include in each type of MFI as follows: formal MFIs including BRI Unit, Rural Bank (BPR) and The Rural Credit Fund Institutions (Lembaga Dana Kredit Pedesaan/LDKP); semiformal MFIs covering rural credit institution (Badan Kredit Desa/ BKD), microfinance NGO, credit cooperatives including Islamic-based cooperatives (Baitul Maal wat Tamwil/BMT); informal MFIs including credit unions, rotating credit and saving association (ROSCA), moneylenders, traders and landlords. Table 3.1 provides map of microfinance institutions by types in Indonesia in terms of units and their financial services. Bank Rakyat Indonesia Unit Lembaga Dana Kredit Perdesaan (LDKP) – The Rural Credit Fund Institutions The Rural Credit Fund Institutions (LDKP) is the term of credit fund institution that operates in rural area, including a variety of non bank microfinance institutions with different names, ownership, organization, services and outreach, that was established on initiatives of provincial government. LDKP belongs to provincial, district or village government which, in their operation, have to obtain license from and was regulated by provincial government within the national regulatory framework. they get technical support and supervision from regional development bank (BPD) which are owned by provincial government.. since it was established in 1970s, the number of LDKP getting less from 1978 to 630 in 2000, this decrease due to the conversion of LDKP to peoples cerdit banks(BPR) and recently only about one quarter of LDKP  have become banks. The Badan  Kredit Desa (BKD) BKD is a profitable and sustainable village level financial institution that provide financial services with a outreach to low income people. it was operated by a committee that controlled by head of village and have sustained the operation since colonial era. On behalf of Bank Indonesia, BRI branch offices supervise and provide technical assistance  for BKD. in 1970s indonesian government did not pay much attention to this system. instead, the government  give more attention to the cooperative system. this make hard for BKD system to developed. in 1990s BRI tried to revive BKD by providing basic capital, improving administrative system and introducing new saving instruments, however, 1992 banking act burden the expanding BKD system. BKD is recognized as peoples credit bank (BPR) and has been operating as a licensed and regulated bank  since 1992 banking act but the frame work setting, supervision and technical assistance has not changed since 2000. Cooperatives Here, the brief history of cooperative in Indonesia refers to Santoso et al (2005) and Ministry of Cooperative, Small and Medium Enterprises’ website (www.depkop.go.id, 2009) as references. The thought of cooperative was delivered for the first time by Patih R. Aria Wiriatmaja at Purwokerto, a small town in Central Java, in 1896. Then, De Wolffvan Westerrode continued his efforts. In 1908, the year of national movement, Dr. Sutomo founded Budi Utomo which played a significant role for cooperatives improving the life of society. Then, Verordening op de Cooperatieve Vereeniging was established. Twelve years after that, in 1927, another type of cooperative called Regelling Inlandsche Cooperatieve was launched. In the same year, to develop bargaining power among local entrepreneurs, Islamic Trader Union (Serikat Dagang Islam) was established. Indonesian National Party (Partai Nasional Indonesia) which had activities in promoting cooperative spirit was established in 1929. 3.2  Bank Perkreditan Rakyat (BPR) Brief History Steinwand (Steinwand 2001) provided detail periodical history about Rural Bank. He divided the history into four parts of periods; the evolution of the colonial BPR (1895-1945), the period from independence to financial sector reform (1945-1983), the period from financial sector reform to financial crisis (1983-1999) and at the present condition. Rural Bank Position in Financial System in Indonesia Chapter 4   Analysis of the Role of Bank Perkreditan Rakyat (BPR) in Financing Micro, Small and Medium Enterprises 4.1  Overview Chapter 4 consists of 6 sections which each section aimed to answer the research questions. Section 1 is a general information about what will be discussed in this chapter; section 2 discusses about the source of the data used in the analysis; section 3 is the methodology; section 4 is about overview the condition of Bank Perkreditan Rakyat (BPRs) and commercial banks (CBs) in Indonesia using selected indicators, third party funds and credits; section 5 tries to reply the first research question by using comparative analysis between commercial banks and BPRs; and section 6 is the last section which answering the second research question about the performance indicators of