The Effect of Debt Management Literacy on Loan Repayment of SMEs Jabodetabek

Abstract

This investigation efforts to bring out the association between the performance of loan repayment, within which small and medium-sized businesses (SMEs) lie in Jabodetabek, Indonesia, and financial literacy, economic conditions, and access to financial resources. The quantitative information composed from 620 individuals were used for this investigate, with the use of a regression model and correlation analysis. The consequences show that there is a statistically optimistic relation between access to financial resources (AFR), the economic environment (EE), debt management literacy (DML), and loan repayment performance (LRP). The results were further supported by regression models, which presented that each of the mechanisms accounted for an abstemiously high quantity of the change in LRP. These answers propose that the higher performance of loan repayment in SMEs has more positive connotation with a positive economic environment, access to financial resources, and enhancement in financial literacy. This adds to knowledge about the variables affecting loan repayment by SMEs. This importance shows that financial development programs, financial literacy education, and easily accessible financial resources are significant factors for bringing about the growth and comprehensive financial standing of SMEs within Jabodetabek City.