Improvement of Business Performance Through Strengthening Islamic Financial Literacy and Entrepreneurial Orientation: Study on Women Enterprises in Jambi City

Abstract

Islamic financial literacy and entrepreneurial orientation are important factors needed by micro and small enterprises (MSEs) to run a business and achieve its performance. This study will examine the effect of Islamic financial literacy and entrepreneurial orientation on business performance. The research sample was Muslim women entrepreneurs in Jambi city, as many as 55 micro, small and medium enterprises, which were collected through questionnaires and interviews with purposive sampling method. Quantitative data analysis uses structural equation models with the Partial Least Square (PLS) approach. The results showed that for the questionnaire with objective questions, the majority of women entrepreneurs were able to answer correctly, but question about the financing simulation with the murabahah contract, more answered they did not know. Furthermore, the results of quantitative data analysis show that Islamic financial literacy and entrepreneurial orientation have a significant positive effect on the performance of women entrepreneurial businesses. Keywords: “Islamic Financial Literacy, Entrepreneurial Orientation, Business Performance, Muslim Women Entrepreneurs”.