Abstract
As one of the banks that distribute loans, the rural bank has a strategic role in the economy. Loans were distributed to the real business sectors and used as venture capital, which will ultimately drive the economy. The contribution of working capital loan for the rural bank in West Java was very small. In fact, the number of rural banks in West Java quite a lot and the performance of the rural bank in West Java in 2016 is also very good. Therefore, it is interesting to know how the role of rural bank working capital loans on the economy in West Java and how big the role is. The method used in this study is Ordinary Least Square (OLS). Variables that used are gross domestic regional product (GDRP), total working capital loan, and consumer price index (CPI). The data used is quarterly data for the period 2009-2016, sourced from Bank Indonesia and Financial Services Authority. The empirical results indicate a significant positive relationship between working capital loan and GDRP in West Java, but the effect is still very small. This shows that the working capital loan channeled by the rural bank have not been used optimally for productive businesses that are able to boost the economy.
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