The Phantom Menace: A Moderation Analysis of Gender on MSMEs’ Financial Literacy and Financial Performance

Micro, small, and medium enterprises or MSMEs in the Indonesian economy have a major role as the largest provider of employment, a means of community empowerment, a creator of new markets, a source of innovation, and their contribution to the balance of payments. Data from the Indonesian co-funding fintech association shows that around 46.6 million MSMEs in Indonesia cannot reach access to financial services or financial inclusion from banks and fintech due to lack of knowledge about financial literacy and inclusion. Therefore, knowledge about financial literacy and inclusion is very important for MSME actors, especially for their financial management which will have implications for the performance and sustainability of MSMEs. Meanwhile, the number of micro and small enterprises is dominated by women with home-based businesses, while in medium enterprises more dominated by men. With these findings, an issue that is hotly discussed in the literature is the issue of gender stereotypes that have implications for business management. In Indonesia, women are also shown to be more involved in private spaces while men are more involved in professional roles. However, findings from a number of studies also show that women's financial literacy levels tend to be lower than men. As a result, in the context of MSMEs in Indonesia, literature indicates that there are issues of financial literacy, gender differences, and constraints on access to financial services in MSME activities which then become something that is principled and important for MSMEs. Therefore, with the support of the above issues, this study then formulated a research objective, which was only found in the literature, namely the analysis of the effect of digital financial literacy and inclusion on the financial performance of MSMEs with gender as a moderation variable. The output of this research is expected to present information that makes a positive contribution both theoretically and managerially. In particular, contributions in providing detailed explanations and guidelines related to financial literacy, financial inclusion, financial performance, and gender issues for MSME actors. This research is also expected to provide recommendations for future research.