Bridging the Gap: Improving Financial Management And Business Practices in Indonesian Msmes through Capacity-Building Interventions

This study evaluates the effectiveness of a capacity-building program designed to enhance financial literacy and business practices among Micro, Small, and Medium Enterprises (MSMEs) in Kemiri Muka, Depok, Indonesia. MSMEs are vital to Indonesia's economy, contributing 61% to GDP and employing 96% of the workforce, yet many struggle with fundamental financial and business management skills. Using The paired sample t-test, the research collected data through pre- and post-training surveys, interviews, and observations from 35 participants. Wilcoxon signed-rank tests revealed statistically significant improvements in participants' understanding of productive assets and ability to differentiate between good and bad debt (p < 0.05), though improvements in other financial knowledge areas were not statistically significant. Participant satisfaction was notably high, with 92% reporting being "Satisfied" or "Very Satisfied" with the training. Particular strengths included relevant training materials, knowledgeable trainers, and quality facilities. The findings demonstrate that targeted capacity-building interventions can effectively improve specific financial management skills among MSME owners, while also highlighting opportunities for program refinement, such as extended training duration and more advanced content for experienced participants. This research contributes valuable insights for policymakers and practitioners designing MSME support initiatives in developing economies.