ANALYSIS OF INFLUENCE GEOGRAPHICAL, LACK OF EDUCATION, AND MONITORING EVALUATION FACTORS TOWARDS MSMEs DECISION MAKING (STUDY CASEPADANG AND BANDUNG)

Abstract

MSMEs are the backbone of the Indonesian economy, amounting to 99.9 % of the number of business units or approximately 56.53 million units. But MSME still have obstacle in choosing Microfinance Institution. To increase the rate of utilization of credit by MSMEs, the government is expanding financial services. But in the process of building financial services, there are challenges facing Indonesia, one of which is the decision of MSMEs in selecting financial institutions especially to Microfinance Institution. In taking the decision to choose the Microfinance Institution is influenced by several factors. These factors are geographical, lack of education, and monitoring evaluation. So, this study aims to analyze of the influence of geographical factors, the lack of public education in the management and financial planning, and monitoring evaluating on the selection decisions making of microfinance institutions by MSMEs, especially in Padang and Bandung City in an effort to help find a strategy of expanding access to financial services in improving the welfare and growth. The respondent of this research was MSMEs of wet food industry in Padang and Bandung which consists of 100 respondents in each location. The data was gathered by questionnaire and further analyzed using statistical tool which was a Multiple Regression. Based on the multiple regression analysis, the result of this study shows that in Padang City, there are two independent variables which are significance are Geographical (X1) and Education (X2). While in Bandung City showed Education (X2) and monitoring evaluating (X3) are the significance factors.