This simplicity of mindset has proven to make a long and winding road for stock market regulators to get MSMEs on board with the idea of offering their shares to the public, even though efforts are being done to increase the number of listed companies from MSMEs.

“There are plenty of issues to be resolved, including on how to groom SMEs and promote them,” said Indonesia Stock Exchange (IDX) assessment director I Gede Nyoman Yetna.

The IDX will soon launch a new “acceleration board” designated for small and medium businesses, with rules more relaxed than the main trading board, to make the local bourse friendlier to small businesses. So far only 17 SMEs have listed their shares on the IDX since 2003, out of 653 publicly traded companies.

“The interest to go public remains very low. SMEs spend most of their time keeping their businesses and livelihoods afloat,” Ikhsan Ingratubun, chairman of the Indonesia Small and Medium Enterprises Association (Akumindo), told The Jakarta Post.

To launch an initial public offering (IPO) on the stock market, companies must have proper financial reports compliant with certain accounting standards, which are still a luxury for SMEs, according to Ikhsan.

“Financial recordings are mostly not proper. Everything is managed simply within the family, or in a very conventional manner,” he added.

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