Economist: Digital Readiness Of Indonesian MSMEs Is Still At The Learning Level

Illustration. (Photo: Doc. Antara)

JAKARTA - The Economist of the National Research and Innovation Agency (BRIN) said the digital readiness of micro, small and medium enterprises (MSMEs) in Indonesia is still at the learning level.

This condition is known from a survey conducted on 600 MSMEs in 10 provinces in 2023 by providing four classifications of digital readiness levels for small business actors.

"There are four levels of digital readiness of Indonesian MSMEs, Level 1 basic score index 1-1.75, Level 2 learner score 1.76-2.50, level 3-intermediate has a score of 2.51-3.25, and level 4 advanced is 3.26-4," said Head of the Research Group. Knowledge Based Economy BRIN Macroeconomic and Financial Research Center Bahtiar Rifai, in Jakarta, quoted from Antara, Thursday 15 February.

He said the index was obtained from six dimensions which were considered to accommodate the readiness of Indonesian MSMEs to be on-board. These values include leadership, business capacity, manufacturing operations, labor and culture, technology, and the business ecosystem.

According to him, in general, the digital readiness index for MSME actors at the level of learning is still dominated by micro and small businesses, because business actors only use digital technology for marketing through social media and e-commerce transactions without being accompanied by further utilization, as well as innovation.

Bahtiar assessed that micro and small business actors still depend on the digital ecosystem that was previously formed by the government, so to overcome this there needs to be collaboration that provides knowledge about digitization of MSME actors who target digital entrepreneurs, as well as digital innovation.

"Collaboration between local governments, academics, media, business communities and MSME players is needed to strengthen the capacity and competitiveness of MSMEs towards Industry 4.0, through digital entrepreneurs, digital financial literacy, digital skills and learning for digital growth in innovation," he said.

Previously, the Coordinating Ministry for Economic Affairs targeted as many as 30 million MSME players in Indonesia to enter the digital ecosystem (on-board) in 2024. Meanwhile, the cumulative number of MSMEs that have utilized digitalization has reached 27 million.