Micro Financing Optimalization Strategy for MSMEs Development (Case Study at Kabupaten Bogor, Indonesia)

Abstract

MSMEs have a great number of important roles in the economy of a country and should be developed and empowered. The main thing needed in the effort to boost the performance of MSME is support in terms of business funding. The impact of microfinance should be optimized through the appropriate strategies of all parties involved. Through appropriate microfinance strategies, MSMEs are expected to experience significant growth. The purpose of this research is to identify factors influencing access of micro finance and, impact of micro financing and to formulate strategy in optimizing microfinance for MSMEs in Bogor Regency. The primary data obtained from the owners of MSMEs of bag and footwear industries was were analyzed using logistic regression and rank test marked Wilcoxon. The primary data from the experts were analyzed using AHP method. The results showed that the factors that influence access to microfinance are monthly profits, total assets and savings access. Microfinance has a positive impact on almost all aspects of MSME performance. The right strategy to optimize microfinance is the CSR partnership financing program.

Enhancing SME Green Performance: The Role of Environmental and Social Responsibility Programs and Environmental Dynamism

“…Furthermore, the provision of low-interest rate loans, while boosting working capital, does not significantly escalate financing costs, thereby optimizing profits. In line with the observations [49], microfinance initiatives, as facilitated by SOEs for Micro, Small, and Medium Enterprises (MSMEs), have a positive impact across all dimensions of MSME performance. It is worth noting that CSR programs in the form of aid to microenterprises extend their reach beyond merely improving micro-enterprise performance; they also play a pivotal role in revitalizing economies grappling with crises, such as the one triggered by the COVID-19 pandemic [50].…”

Adaptive Financing Pattern for Small Scale Fisheries with Case Study of Pajeko Fisheries in Bitung

“…Bank of Indonesia itself stated on its official website (https://www.bi.go.id/id/umkm/ kelariah/pola-pembinance/default.aspx) that there are still many small-scale business operators who have difficulty getting access to banks credit, both due to technical constraints, such as insufficient collateral, and non-technical constraints, such as limited access to banking information. Various obstacles to financial access for MSM businesses in developing their businesses are due to the lack of information related to the formal financing sector, high transaction costs, and complicated financing procedures (Jasuni, 2018). According to Purba (2008), some financial institutions do not have a significant role in building small-scale fisheries, among others, due to inappropriate credit scaling, relationships that are not well-built, and the establishment of guarantees that cannot be met by small-scale fisheries.…”

Impact of Business Plans for the Development of MSMEs

“…In developing the national economy, the Indonesian government issued policies relating to MSMEs as a top priority to reduce poverty and increase community income [1]. In addition, MSMEs are superior products owned by each region based on a populist economy that elevates local wisdom to be able to compete with other similar products [2], [3].…”