Title:
The Influence of Digital Technology on Indonesian Micro Companies’ Financial Performance

Authors:
Citra Anggreani, Falikhatun, Indonesia

Abstract:

Developments in the business sector is intricately linked with advancements of the information technology. Consequently, entrepreneurs are anticipated to utilise the advancements provided by this technology. This study aims to assess the effects of the integration between financial technology (fintech) and accounting information system (AIS) software on the financial performance of micro, small, and medium enterprises (MSMEs). This study investigated 511 MSMEs situated in different areas of Indonesia that employ technology and digitalization in their manufacturing operations. The data was gathered through questionnaires via Google Forms and the utilisation of purposive sampling technique. This study uses PLS-SEM (Partial Least Squares Structure Equation Model) for its analysis. The findings suggest that the utilisation of fintech and AIS software greatly enhances the financial performance of MSMEs. The findings of this study will give advantages to MSMEs as they expand their operations, considering the significance of digital technology in the business sphere which require entrepreneurs, particularly those from the millennial cohort, to augment their digital literacy.

DOI: https://doi.org/10.51505/IJEBMR.2024.8104