The COVID-19 pandemic has brought an unprecedented challenge for micro, small, and medium enterprises (MSMEs) globally, including in Indonesia. In response to the pandemic, the Government of Indonesia launched a program to provide working capital assistance for micro-entrepreneurs categorized as poor and who are vulnerable to being affected by the COVID-19 pandemic. Many MSMEs in Indonesia are also on the brink of failure during the COVID-19 pandemic as revenue significantly decreased due to a significant drop in demand (Badan Pusat Statistik, 2020). The majority of female MSMEs also experienced a decrease in revenue during the early months of the pandemic. Considering that MSMEs are the backbone of the national economy, and according to an estimation that women own 64.5% of the total 37 million MSMEs in Indonesia in 2018, it is essential to conduct a study on gender considerations to MSME policy responses to COVID-19 in Indonesia. The research aims to assess the gendered aspect of MSMEs policy responses in Indonesia and examines genderbased differences regarding the impact of the pandemic and MSMEs survival strategies. The study used a combination of online questionnaires, key informant interviews and FGDs.

This study finds that slightly more women MSMEs suffered a sales decline and an increase in the cost of production compared to men MSMEs. More women MSMEs (82.3%) also reported inadequate working capital than men MSMEs (80.6%) as a major obstacle, although the difference is not statistically significant. Our survey results reveal that more than 60% of women-owned MSMEs reported a difficulty in assessing finance due to a too high repayment risk, too high interest rates, and that they already had too many outstanding loans. In terms of challenges, women MSMEs also specifically reported an issue of balancing business and domestic work for the employees compared to men MSMEs, which confirms the double burden experienced by women in their everyday life. On the other hand, the most important challenge for men-owned-MSMEs was the drop in demand. Almost 80% of the men MSMEs stated this to be a problem, while that challenge was only the third most challenging issue for women-owned MSMEs.

Changing the business strategies during the pandemic was very challenging especially for womenowned MSMEs. Around 60.8% of men MSMEs changed their products and offered alternative products, while only 45.5% of women MSMEs did so, where the difference between the two genders was statistically significant. Leveraging to online selling seems to be the most go to strategies for MSMEs. As much as 82% of the women MSMEs and 80% of the men MSMEs leveraged online selling as part of their survival strategy, and the difference is statistically insignificant. We also found that women MSMEs had utilized digital technology for various business functions, such as business administration, planning, supply chain management, marketing, and service delivery. Meanwhile, men MSMEs were more likely to utilize digital technology for sales and payment. Our survey also showed that in general, women-MSMEs were slightly left behind compared to men MSMEs in terms of applying a digitization strategy for their business. On average, slightly fewer women (60.5%) had applied various digitalization strategies compared to men MSMEs (63%), but this difference was not statistically significant. Among the digitalization strategy used by women MSMEs is the utilization of social media for online selling. Online selling through social media such as Instagram, Facebook, or WhatsApp seems to be more familiar for women-owned MSMEs than it is for men MSMEs. For most of other digitalization strategies, however, more men MSMEs started or strengthened the digitization solutions, compared to the women-owned MSMEs. However, there was a total of 51.6% of the women-owned MSMEs who increased the use of internet and digital platforms during the pandemic, compared to 44.7% of men-owned MSMEs.

Support to survive the pandemic also comes from the private sectors. Our survey showed that borrowing money or taking loans was the least-sought support for both women and men MSMEs, and in particular loans from banks, informal creditors, and digital financing platforms. This suggests that in general, the MSMEs were reluctant in seeking loans, except if the loans came from family or friends. On average, only about 32.7% of the MSMEs sought loans from non-bank financial institutions, informal creditors, or digital financing, and less than half of them (42.8%) sought loans from the banks. On average, only 30% of the women MSMEs sought loans from various sources, such as banks, non-banks, digital financing, or informal creditors, while the percentage for men MSMEs was up to 40%. The number of women-owned MSMEs who sought loans from banks was 37.75% while the menowned MSMEs who did was 47.48%, where the difference was statistically significant.

In terms of policy support from the government, all MSMEs reported that cash transfer was the most applied program and the most helpful. The survey also reveals that the number of MSMEs who applied for government support programs is low and indicates that the requirements for receiving government support were too complicated and that poor public services hindered them from getting the support. It was found that more women MSMEs require policymakers to improve communication when providing policy support. In the policy formulation arena, more than half of the women-owned MSMEs (50.2%) agreed to integrate the gender components into the policy’s design, while only 36.3% of the men-owned MSMEs agreed to that view. More of the women-owned MSMEs also agreed that gender-based policy targeting was important compared to men-owned MSMEs. About 37.8% of the women-owned MSMEs agreed that policies to assist businesses should be targeted based on the gender of the owner/leader of the business, while 36.3% of the men-owned MSMEs agreed to that view. Despite the little difference in that view between the women-owned and the men-owned MSMEs, the difference was statistically significant.

Nevertheless, this study found that the gender of MSMEs ownership has not yet been considered in the policy formulation but rather on how active the MSMEs had been in participating in communitylevel or business associations. Furthermore, lack of gender disaggregated data is seen as a noticeable challenge in implementing gender-based analysis in policy making process. The absence of agreed definition of MSMEs hampers effort to collect the disaggregated data. The overall situation of lack of gender analysis in the policy making process have continued and are reflected in COVID-19 policy responses that we found, which are not gender responsive.

Based on the study findings, we highlight the need to have a formal and agreed definition of MSMEs owned or managed by women among key stakeholders at the national and sub-national levels to pave the way to incorporate gendered aspects in policy formulation. We also suggest that the government improve policy response to remove obstacles and challenges faced by MSMEs and improve program delivery by improving program knowledge and awareness among MSMEs. The government could also act on implementing gender-responsive practices, including gender-based analysis in the policymaking process