INFLUENCE OF FOUNDER’S FINANCIAL BEHAVIOR TRAITS AND FINANCIAL LITERACY ON SMES SOUNDNESS

• Main Author: Gusman, Nakita
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/57039
• Institution: Institut Teknologi Bandung

A study to identify determinant variables in the success of entrepreneurial businesses is critical to achieving better socioeconomic development in Indonesia. In this study, researchers used important decision-making variables, such as financial behavior and financial literacy, to analyze the impact of these two concepts on the business performance of SMEs founders across Indonesia. This research uses a survey of 482 SMEs from Halal2Us event conducted all across Indonesia on the period of mid-January until early March in 2021, mainly on Jabodetabek area. This study employs multivariate regression analysis as a tool for determining the impact of founder financial behavior traits and financial literacy variables on SMEs performance as a dependent variable. According to the findings of this study, financial literacy and three of the four variables of financial behavior traits are significant. It demonstrates that founders' confidence, impulsivity, financial act, and financial literacy have a significant influence on the soundness of SMEs. The result also suggests that founders with good financial knowledge and low impulsivity may make better decisions in a professional setting.