Beyond Remittances: Financial Literacy and Business Preparedness Among Indonesian Migrant Workers

Abstract

Indonesian migrant workers (IMWs) contribute significantly to Indonesia's economy through remittances, yet the long-term use of migration income remains a concern as they prepare for post-return livelihoods. Existing studies examine financial literacy, remittance use, or entrepreneurship in isolation, offering limited insight into their interconnection in pre-return preparation. This study therefore explores financial literacy, remittance management, business planning, and business preparedness among IMWs in Penang, Malaysia. Using an exploratory qualitative approach, semi-structured interviews were conducted in May 2026 with four IMWs and one migrant workers' organization representative, and the data were then analyzed thematically. Findings suggest financial literacy is reflected in goal setting, budgeting, expenditure monitoring, saving, and investment, varying with individual and family circumstances. Remittance management balances household needs, family and educational responsibilities, savings, and investment rather than progressing uniformly from consumption to investment. Occupational skills, prior entrepreneurial experience, financial resources, and family support shape business planning, while business preparedness encompasses capital, business experience, market familiarity, and operational challenges. Viewed through the sustainable livelihoods framework, these interconnected but non-linear practices show how migrant workers mobilize financial, human, and social resources for prospective livelihoods while still abroad, rather than evidencing post-migration reintegration. The findings support integrating financial management and business preparation into migrant support initiatives.