<![CDATA[Micro, Small, and Medium Enterprises (MSMEs) play a vital role in Indonesia’s economic development, particularly in Bantul Regency, Yogyakarta, which has one of the highest concentrations of MSMEs in the region. Despite their contribution, limited access to formal financing remains a persistent challenge, often linked to low financial literacy. This study assesses the financial literacy of MSME owners in Bantul, examines their financial management practices, and identifies factors influencing financial effectiveness using an explanatory sequential mixed-methods design. In the quantitative stage, survey data were collected from 31 purposively selected grocery-store MSME owners, measuring financial management, saving, and debt literacy. In the qualitative stage, semi-structured interviews explored the reasoning behind the survey responses and provided contextual understanding. Findings show that MSME owners exhibit uneven financial literacy across dimensions: saving and debt literacy appear relatively adequate, while financial management particularly bookkeeping and the separation of personal and business finances remains weak. Many respondents view financial recording as unnecessary due to small business scale and unstable income, indicating that financial knowledge has not yet translated into practical behavior. These results suggest that improving financial literacy requires not only conceptual understanding but also behavioral competence and supportive financial routines. The study enriches localized evidence on MSME financial literacy and highlights the need for practical, behavior-based financial education programs to strengthen financial capability. Enhancing these competencies is crucial for promoting long-term business sustainability, enabling MSMEs to manage risks more effectively, maintain operational stability, and improve their resilience amid economic fluctuations.]]>
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