LetRbe a commutative ring andSa finite locally inverse semigroup. It is proved that the semigroup algebraR[S]is isomorphic to the direct product of Munn algebrasℳ(R[GJ],mJ,nJ;PJ)withJ∈S/𝒥, wheremJis the number ofℛ-classes inJ,nJthe number ofℒ-classes inJ, andGJa maximum subgroup ofJ. As applications, we obtain the sufficient and necessary conditions for the semigroup algebra of a finite locally inverse semigroup to be semisimple.