Financial inclusion, operating costs, and entrepreneurial traits; Gender-based insights into MSME financial performance in Indonesia

Resumen

This study investigates the unique effects of financial inclusion, operating costs, and entrepreneurial characteristics on the financial performance of micro, small, and medium enterprises (MSMEs) in Indonesia, with a specific focus on gender-based analysis. Using a 2023 sample of 292 MSMEs across 29 Indonesian provinces, this research incorporates a diverse and extensive dataset to enhance the understanding of MSME dynamics. Structural Equation Modeling (SEM) was employed to analyze the relationships among the variables. The findings reveal that financial inclusion, operating costs, and entrepreneurial characteristics significantly enhance MSME financial performance, with no notable performance differences between male-led, female-led, or jointly managed businesses. These results provide insights into achieving equitable and optimal MSME financial performance and inform strategies to enhance women’s roles in Indonesia’s economy.