PENGARUH PENEGAKAN HUKUM KONTRAK TERHADAP KINERJA USAHA KECIL DAN MENENGAH (UKM) DI INDONESIA

Abstract

Small and Medium Enterprises (SMEs) play a vital role in the Indonesian economy. However, SMEs often face challenges in contract enforcement that can affect their business performance. This study aims to analyse the effect of contract law enforcement on the performance of SMEs in Indonesia. The method used is a qualitative approach with in-depth interviews with SMEs and business law experts. The results show that weak contract law enforcement, such as uncertainty in dispute resolution and the length of the litigation process, negatively impacts SME performance. This hinders SMEs' access to finance, reduces trust in business partnerships, and increases transaction costs. The study concludes that reforms in the contract law enforcement system, such as strengthening alternative dispute resolution mechanisms and improving the capacity of judicial institutions, are needed to support the growth and competitiveness of SMEs in Indonesia.