Implementation Of Balance Principles In Small Business Development Through Bank Credit Agreements

Abstract

This article aims to examine the application of the principle of balance in the development of small businesses through bank credit agreements. An example of a clause that burdens small businesses in developing their business is related to the existence of material guarantee requirements. Banks still set requirements and procedures that are not easy for small businesses to be creditworthy (bankable). This problem is on the banking side because banks apply the principle of prudence in lending to small businesses. This is also due to the lack of information about the performance and capabilities of these small businesses. The application of the principle of balance is needed in bridging the interests of small businesses and banks in their legal relationship. Through the application of this balance principle, it can provide protection for small businesses that are economically weak in their business development. And also this principle of balance is a principle that must be in an agreement that can reflect justice for the parties who make the agreement. With the bank's position as a stronger party in determining rights and obligations in credit agreements when dealing with small businesses, this balance principle is a solution to bridge credit agreements between small businesses and banks.