FINANCIAL LITERACY IMPACT ON SMALL-MEDIUM ENTERPRISES DEVELOPMENT AND SUSTAINABILITY IN INDONESIA

• Main Author: Rajendra Nugroho Sembiring, Seth
• Format: Final Project
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/68140
• Institution: Institut Teknologi Bandung

Small-medium enterprises (SMEs) in Indonesia are becoming the pillars for the future of Indonesia's economy. Hence SMEs need to thrive and survive in the business world. This research aims to examine the correlation between financial literacy and the sustainability of small-medium enterprises in Indonesia. Financial literacy in Indonesia is low, and it is not considered an essential factor for the sustainability of SMEs. Although the financial literacy percentage in Indonesia is still low, this does not mean that every SME owner in Indonesia is financially illiterate A qualitative study will be used to process the data. Data are collected through in-depth interviews of 7 SME owners in Indonesia. The interview are all conducted online through zoom and are conducted using Bahasa Indonesia to eliminate language barrier. Which then are analyzed qualitatively using the Nvivo application. Using the codes that includes of the characteristic of financial literate business person. 4 codes are created, named financial attitude, financial literate, technological innovation, and effect on SME. Secondary data are also collected to eliminate the bias of the researcher. Those data are then analyzed using exploratory analysis. And the result is shown that there is a positive correlation between financial literacy and the development and sustainability of the SME. The findings in these papers are essential information for business people and SME owners in Indonesia that being financially literate significantly impacts their businesses.