Since it's the smaller front chainring and the smallest back cog, then your chain is a bit too long, but I wouldn't shorten it just yet. It works reasonably OK as it shows in the photos. And you don't normally use this combination, anyway. (Since I have the chain tool, if it was my bike, I'd probably shorten it, though)

I would first clean the chain and cogs.

Most critically, wipe all the road grime off the derailleur and oil all the derailleur pivots including where it says "Suntour" and where it says "patented". Use chain oil. Shift it up and down to work the oil in, then wipe off all the excess oil. This may help to keep more chain tension when it's in the small-small combination, and will help with shifting in general.