Literature Review: The Effect Of Financial Literacy And Financial Inclusion On The Performance Of Micro, Small And Medium Enterprises (MSMEs)

Abstract

This study aims to analyze the influence of financial literacy and financial inclusion on the performance of Micro, Small, and Medium Enterprises (MSMEs) using a Systematic Literature Review (SLR) approach. The review was conducted by examining fifteen research articles, including national and international scholarly publications issued between 2019 and 2025, which explicitly discuss the relationship between financial literacy, financial inclusion, and MSME performance. The results indicate that both financial literacy and financial inclusion have a positive and significant effect on improving MSME performance. Financial literacy serves as an internal factor that strengthens entrepreneurs’ ability to manage finances, while financial inclusion functions as an external factor that broadens access to formal financing sources and digital financial services. The review also reveals a synergistic relationship between the two, in which financial literacy enables MSME actors to utilize financial services effectively, whereas financial inclusion provides the means to apply such knowledge in business practice. These findings emphasize the importance of integrating financial literacy enhancement programs with financial inclusion policies to strengthen the competitiveness and sustainability of MSMEs in the digital economy era.