Abstract

The government is committed to supporting environmentally-friendly SMEs through green financing policies. With this policy, it is hoped to enhance the green capabilities of SME players. This research aims to find solutions to improve SMEs' access to green financing while considering the level of sustainability literacy. Therefore, this research analyzes and tests the influence of sustainability literacy on SMEs' green capability by considering the level of green financing inclusion. The research object is SMEs in the agribusiness sector in the Tapal Kuda area, using primary data obtained from a questionnaire survey of 70 SME players. The research method uses a quantitative approach. The research results show that sustainability literacy significantly influences green capability, while green financing significantly intervenes in the relationship between sustainability literacy and green capability. The results of this research imply the need for collaboration among various parties, including the government, banks, SME players, academics, and other stakeholders to continuously improve cooperation so that this green financing program can become a solution for SMEs in addressing sustainability issues.

Keywords: Green Capability, Green Financing, SMEs, Sustainability Literacy