T The aim of this research is to examine recent development of micro, smalland medium enterprises (MSMEs), their main constraints and access tofinancing, and the growth of online-based Peer-to-Peer (P2P) lending inIndonesia. This is a descriptive study which analyses secondary and primarydata. Primary data were collected from: (i) a survey of 60 respondents, i.e.30 owners of MSMEs and 30 managers/directors of P2P lending companies,of which a total of 40 were deemed usable (i.e. 10 MSMEs and 30 P2P), and(ii) a series of focus group discussions (FGD) with some of the selected P2Pcompanies. This study’s results show the number of MSMEs continue togrow even though they face a number of obstacles with limited access tofunding as the most serious. Although commercial banks are required by thegovernment to extend credit to MSMEs, the percentage of total commercialcredit to these enterprises is still very small. Therefore, as the survey’sfinding suggested, the emergence of P2P is important as an alternativesource of funding for MSEs. and bank is the main investor in P2P lendingcompanies. To the authors' knowledge, this is the first study ever done, atleast in Indonesia. It takes stock of the empirical evidence in the literaturethrough the lens of MSMEs’ owners