Financial Literacy and Symbolic Capital in Improving the Performance of MSMEs

Semarang city is home to 84 MSMEs under the guidance of PTPN IX. These small-scale businesses face significant challenges related to financial literacy and performance, including limited understanding of financial management, investment strategies, debt management, long-term financial planning, and the ability to leverage financial opportunities. This investigates the impact of financial literacy on MSME performance, with symbolic capital serving as a mediating variable. A quantitative approach was employed, using both primary and secondary data collected through questionnaires distributed to all 84 MSMEs supported by PTPN IX located in Semarang. A saturated sampling method was used. Data were analyzed using SEM-PLS, involving two stages: (1) measurement model testing to assess the validity and reliability of construct indicators, and (2) structural model testing to examine relationships among constructs using PLS t-test. The results indicate that symbolic capital fully mediates the relationship between financial literacy and MSME performance, suggesting that financial literacy indirectly influences performance through symbolic capital. These findings highlight the importance of enhancing financial literacy among MSME owners to build symbolic capital, which in turn can improve overall business performance.