Members of the South Bandung Agricultural Cooperative (KPBS) have seen a 38% rise in performing loans and a 43% increase in sales volumes over two years after adopting a new business app.
“Easier access to financing means higher loan volumes, more livestock, and increased incomes for farmers,” said Aun Gunawan, KBPS director. “This is how financial inclusion improves livelihoods.”
Indonesian dairy farmers are using a business app to boost sales.
Founded in 1969, KPBS has 5,000 members and produces 70,000 tonnes of milk daily. The cooperative operates its own dairy, using 15% of its milk to make yogurt and mozzarella, with the rest sold to local dairy companies.
The cooperative also runs a hospital, veterinary service, and bank to support members and enhance competitiveness.
“We take a holistic approach focusing on health: the health of farmers, their livestock, and financial health,” Gunawan told UN agency leaders visiting KPBS.
The International Labor Organization (ILO) supports the cooperative’s vision, using digitalization to enhance financial inclusion, in partnership with Indonesian financial authorities.
“KPBS was strong and well-managed before our involvement,” said Simrin Singh, ILO director for Indonesia and Timor-Leste. “Our tools have catalyzed further improvements and livelihoods.”
The ERP system, introduced by the ILO with Swiss funding, allows farmers to track income and expenses, including fodder costs. They have 24/7 access to veterinarians, who reach farms within 30 minutes, and can separate milk from recently vaccinated cows to ensure quality.
“These improvements lead to higher volumes and better prices per liter,” Gunawan said. Improved finance access is the most significant impact. The cooperative operates its own bank, simplifying loan applications through the ERP system, increasing approval rates.
Farmers can now apply online, saving time and effort, as financial data is recorded and accessible. “We can apply online and be productive, making us more likely to seek funding,” said farmer Encih Mintarsih.
Programs like this support Indonesia’s goal of food self-sufficiency. The country imports 80% of its dairy products. Boosting local production strengthens national self-sufficiency.
“In a country like Indonesia, digital and financial access are key to higher-income status,” said Gita Sabharwal, UN Resident Coordinator in Indonesia. Digitalization and finance access are priorities in the UN-Indonesia cooperation framework.
The UNSDCF, signed in August 2025, aligns with SDGs and Indonesia’s agenda, focusing on economic and digital transformation. “This ILO program shows how the UN can aid inclusive development through technology,” Sabharwal said.
The project supports OJK’s Rural Bank Transformation Plan and enhances the inclusive financial ecosystem, aligning with national priorities to digitize SMEs and boost productivity.
“SMEs create 90% of jobs in Indonesia. Improving their competitiveness is crucial for decent work,” Singh added. This approach aims to expand nationwide.
Gunawan advises cooperatives and policymakers: “Show farmers tangible benefits, and they’ll adopt digital technologies quickly. Words like ‘digitalization’ and ‘financial inclusion’ must translate into their daily lives, as we’ve done with ILO and UN support.”
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