3 tips for successful financial management and business development for MSMEs | Bahasa

Bank DBS Indonesia collaborates with Komerce to provide education on effective business financial management for MSMEs

Kedai Belajar DBS strengthens Bank DBS Indonesia's commitment to supporting Financial Inclusion Month Activities

Indonesia, 09 Oct 2023 - Data from the Ministry of Cooperatives and Small and Medium Enterprises showed that in 2022 there were 8.71 million micro, small and medium enterprises (MSMEs) in Indonesia. In running their business, MSMEs need capital for different purposes such as purchasing and processing raw materials, buying equipment and hiring new employees. This has led to a significant increase in the amount of loans extended to MSMEs, to Rp15.63 trillion for MSMEs owned by individuals and Rp4.13 trillion to MSMEs owned by business entities, according to data from the Financial Services Authority (OJK). The loan growth shows the high demand for easier and faster access to financial services by MSMEs.

For those of you who are just starting a small-scale business, keep in mind that you don’t have to rely on online loans! Bank DBS Indonesia and Komerce have outlined several stages of business financial management you need to heed to ensure effective financial management. What are they? Let's take a look at them one by one and learn how to implement them in business!

Set your financial goals
Setting your financial goals is the first step in managing business finances. The goals must meet the SMART indicators, namely Specific, Measurable, Achievable, Relevant, and Time-bound. Well-identified goals can make you more focused on managing business finances and increase your chances of achieving your financial objectives. The more detailed your goals are, the easier it will be for you to visualise them.

Create a financial plan
Financial planning is essential for MSMEs to manage business cash flow in a more structured and efficient manner. With good financial planning, MSME players can manage resources, income, assets, and working capital more effectively, which will automatically help prevent business waste, thus maximising the use of available funds. There are three steps in creating a financial plan: collecting relevant data, analysing data, and developing the plan.

Collecting relevant data. You can start by forecasting your business income. Calculate the estimated expected income from sales and your operating costs, then analyse the data to determine whether you have a cash surplus by taking into account the investment value. If you have a surplus, consider investing the excess funds back into the business, but if there is a deficit, identify areas where cost reduction measures may be necessary.

Lastly, you can develop a plan based on the results of your data analysis to increase your business surplus. The plan should include such steps as purchasing cheaper raw materials to reduce costs, reviewing operating activities, and increasing business capacity to increase revenue. By creating a clearly defined and detailed plan, you will have a guide that can help your business achieve effective financial goals.

Execution and monitoring!
Planning is useless without proper execution. Make sure that the financial plan is implemented consistently based on the short-, medium-, and long-term goals. It is also important to routinely oversee and monitor the financial performance of your business, including revenue, costs, and profitability, so that you can maintain financial stability and maximise the chances of success in achieving financial goals.

All of the matters mentioned above were discussed in depth at the Kedai Belajar DBS event entitled "Building the Foundation for Family and Business Financial Management''. The event was held by Bank DBS Indonesia and Komerce in several cities, including Makassar and Pontianak, to support Bank Indonesia in improving the financial literacy index and supporting Financial Inclusion Month. Kedai Belajar DBS presented experts with specialised knowledge to educate MSME owners on how to manage their business finances and maintain a stable turnover. Participants also learned about sustainable finance.

Chief Executive Officer at Komerce Nofi Bayu Darmawan said, "We believe that many MSMEs in various regions across Indonesia have great potential to grow, meet the needs of increasingly diverse customers, and improve the nation's economy. Therefore, we are committed to harnessing this potential by providing MSMEs with the necessary knowledge to manage their business finances, including through collaboration with Kedai Belajar DBS that is now in its second year. We hope that once they are equipped with great knowledge and skills, MSMEs will be able to deal with risks that may arise."

"Kedai Belajar DBS is part of Bank DBS Indonesia's third pillar of sustainability, Impact Beyond Banking, which demonstrates the bank's commitment to providing a broader positive impact. In addition to providing education on financial management, we also want entrepreneurs to better understand ways to obtain business capital through different sources. They can do this by participating in DBS Foundation Business for Impact Grant Award 2023, a flagship programme of the DBS Foundation to support impactful businesses, both social entrepreneurs and small and medium enterprises (SME) that are transitioning to social enterprises, through grants," Head of Group Strategic Marketing & Communications at PT Bank DBS Indonesia Mona Monika added.

Bank DBS Indonesia not only provides education for SMEs but also for students through DBS Berpijar. The programme is held in collaboration with Pijar Foundation and has successfully reached more than 9,000 students within three months through an educational video and podcast with the theme "Improving Digital and Financial Literacy to Face Economic Challenges and Global Competitiveness". Bank DBS Indonesia employees also participated in creating the educational content as source persons to share their knowledge.

Hopefully, all of the above tips are useful for managing your business finances! To find out more about Kedai Belajar DBS or about DBS Foundation, visit Foundation | DBS Indonesia



About DBS
DBS is a leading financial services group in Asia with a presence in 19 markets. Headquartered and listed in Singapore, DBS is in the three key Asian axes of growth: Greater China, Southeast Asia and South Asia. The bank's "AA-" and "Aa1" credit ratings are among the highest in the world.

Recognised for its global leadership, DBS has been named “World’s Best Bank” by Global Finance, “World’s Best Bank” by Euromoney and “Global Bank of the Year” by The Banker. The bank is at the forefront of leveraging digital technology to shape the future of banking, having been named “World’s Best Digital Bank” by Euromoney and the world’s “Most Innovative in Digital Banking” by The Banker. In addition, DBS has been accorded the “Safest Bank in Asia” award by Global Finance for 15 consecutive years from 2009 to 2023.

DBS provides a full range of services in consumer, SME and corporate banking. As a bank born and bred in Asia, DBS understands the intricacies of doing business in the region’s most dynamic markets.

DBS is committed to building lasting relationships with customers, as it banks the Asian way. Through the DBS Foundation, the bank creates impact beyond banking by supporting social enterprises: businesses with a double bottom-line of profit and social and/or environmental impact. DBS Foundation also gives back to society in various ways, including equipping communities with future-ready skills and building food resilience.

With its extensive network of operations in Asia and emphasis on engaging and empowering its staff, DBS presents exciting career opportunities. For more information, please visit www.dbs.com.