The Effectiveness of the Business Capital Assistance Program in Improving the Performance of MSMEs in Palu City
DOI:
https://doi.org/10.37899/mjde.v3i1.329Keywords:
Business Capital Assistance, MSME Performance Government Support Programs, Post-Disaster Economic RecoveryAbstract
Micro, small, and medium enterprises (MSMEs) play a crucial role in local economic recovery, particularly in post-disaster regions. This study aims to evaluate the effectiveness of the Business Capital Assistance Program in improving MSME performance in Palu City, Indonesia. The study focuses on whether government-provided capital support contributes to improvements in business income, production or sales capacity, and operational continuity. A quantitative approach was applied using a cross-sectional explanatory research design. Primary data were collected through structured questionnaires administered to MSME owners who had received business capital assistance from the local government. The data were analyzed using descriptive statistics and regression analysis to examine the relationship between capital assistance and MSME performance while controlling for business age and sectoral differences. The findings indicate that business capital assistance has a positive and statistically significant effect on MSME performance. Beneficiary enterprises experienced increased income, improved production or sales volume, and stronger operational stability after receiving capital support. The effects were more pronounced among MSMEs operating in trade and food-related sectors, suggesting that sectoral characteristics influence the effectiveness of financial assistance. Overall, the study concludes that business capital assistance is effective in supporting MSME recovery and short-term performance in Palu City, although complementary non-financial support is needed to enhance long-term sustainabilityMicro, small, and medium enterprises (MSMEs) play a crucial role in local economic recovery, particularly in post-disaster regions. This study aims to evaluate the effectiveness of the Business Capital Assistance Program in improving MSME performance in Palu City, Indonesia. The study focuses on whether government-provided capital support contributes to improvements in business income, production or sales capacity, and operational continuity. A quantitative approach was applied using a cross-sectional explanatory research design. Primary data were collected through structured questionnaires administered to MSME owners who had received business capital assistance from the local government. The data were analyzed using descriptive statistics and regression analysis to examine the relationship between capital assistance and MSME performance while controlling for business age and sectoral differences. The findings indicate that business capital assistance has a positive and statistically significant effect on MSME performance. Beneficiary enterprises experienced increased income, improved production or sales volume, and stronger operational stability after receiving capital support. The effects were more pronounced among MSMEs operating in trade and food-related sectors, suggesting that sectoral characteristics influence the effectiveness of financial assistance. Overall, the study concludes that business capital assistance is effective in supporting MSME recovery and short-term performance in Palu City, although complementary non-financial support is needed to enhance long-term sustainability.
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