Beyond Fintech Adoption: Examining How Financial Literacy and Fintech Capabilities Enhance MSME performance Through Technology Acceptance and Financial Inclusion

Abstract

This study examines the influence of financial literacy, financial technology, and financial innovation on the performance of micro, small, and medium enterprises (MSMEs) in East Java, Indonesia, with financial inclusion as a mediating variable and the Technology Acceptance Model (TAM) as a moderating variable. The study employed an explanatory quantitative design using survey data collected from MSMEs listed in the Bank Indonesia East Java MSME database. From a target sample of 271 MSMEs selected through stratified proportional random sampling, 256 usable responses were obtained. Data were collected using a five-point Likert-scale questionnaire and analyzed using partial least squares structural equation modeling (PLS-SEM). The findings show that financial literacy, financial technology, financial innovation, and financial inclusion have positive and significant effects on MSME performance. Financial literacy, financial technology, and financial innovation also positively and significantly influence financial inclusion. Financial inclusion has the strongest direct effect on MSME performance and significantly mediates the effects of the three financial capability variables on MSME performance. However, TAM does not significantly moderate the relationship between financial inclusion and MSME performance. These results indicate that MSME performance is driven more by financial capability, financial access, and effective use of financial services than by general technology acceptance alone. The study contributes to MSME performance literature by positioning financial inclusion as a central transmission mechanism between internal financial capabilities and business outcomes.