This paper analyzes the development of financial inclusion in Indonesia and its impacts on Indonesian micro，small and medium enterprises（MSMEs）development using data covering 2011-2021 from World Bank and questionnaire survey. We find that the level of financial inclusion in Indonesia is still standing significantly behind the neighboring country-Malaysia. The penetration rate of adults with formal financial institution accounts is only about 50% and the rate of those with loan records is even lower than 20%. However，the trend has been improving，with the financial inclusion index increasing by nearly 10 percentage points in the past five years and digital banking services being vigorously promoted. The survey in West Java province shows that the penetration rate of bank accounts and online banking services among MSMEs is high，but the borrowing rate is low. The interviewed MSMEs have a low evaluation of the value of existing financial services，but evaluate the online financial services positive. The regression analysis shows that the financial inclusion has a significantly positive impact on the performance of MSMEs. The paper concludes with a brief discussion on government policies to promote financial inclusion development.