How Satisfaction with Digital Payments Drives SME Performance

Abstract

The increasing adoption of digital payment services has transformed the way small and medium enterprises (SMEs) conduct business transactions. However, the effectiveness of digital payment adoption depends not only on technological usage but also on users’ perceptions and satisfaction with the services provided. This study aims to examine the effects of Perceived Ease of Use of Digital Payment (PEOD) and Perceived Usefulness of Digital Payment (PUD) on SME Satisfaction (SMS), as well as the influence of SME Satisfaction on SME Performance. A quantitative research approach was employed using data collected from 100 SMEs in West Java selected through purposive sampling. Data were gathered through structured questionnaires and analyzed using Structural Equation Modeling with Partial Least Squares (SEM-PLS). The study investigates the role of SME satisfaction as a mechanism that explains how perceived ease of use and perceived usefulness of digital payment contribute to business performance improvement. The findings provide empirical insights into the relationship between digital payment perceptions, user satisfaction, and SME performance from a financial performance perspective. This study contributes to the digital payment and SME literature by emphasizing the importance of user satisfaction in translating digital technology adoption into improved business outcomes. The findings also offer practical implications for SMEs, fintech providers, and policymakers in developing more effective digital payment ecosystems.