The Effects of Financial Inclusion and Financial Literacy on MSMEs' Financial Performance in Belitung

Abstrak

Purpose: This study examines how financial inclusion and financial literacy affect MSMEs' financial performance of MSMEs in Belitung. Additionally, it aims to determine how each variable contributes to the long-term gains in corporate performance.

Research Methodology: This study used a survey method as part of a quantitative approach. A selective sample of 100 MSME operators in Belitung provided the necessary data. A questionnaire based on measures of financial performance, inclusion, and literacy served as the research tool. Multiple linear regression analysis was performed on the collected data using SPSS software.

Results: The study's findings show that financial literacy significantly and favorably affects MSMEs' financial performance in Belitung. In the meantime, it doesn't seem like financial inclusion significantly affects MSMEs' financial performance.

Conclusions: These results suggest that enhancing MSME owners' financial success is mostly dependent on their capacity to comprehend and manage finances. However, the ability to use formal financial services efficiently is a prerequisite for their direct impact.

Limitations: The results of this study cannot yet be widely applied because they are restricted to a sample of 100 MSME operators in Belitung and only employ two independent variables.

Contribution: This study offers empirical proof of the significance of financial inclusion and financial literacy in enhancing MSMEs' financial performance at the regional level.