Author: Dr. Setiawan et al. (2026)
Financial technology (FinTech) has become an important instrument for expanding financial inclusion among micro, small, and medium enterprises (MSMEs), particularly in developing economies where access to formal financial services remains limited. In Indonesia, MSMEs play a critical role in employment generation and local economic development, yet many enterprises, especially in rural areas, continue to face barriers in obtaining financial services, including limited banking access, inadequate financial literacy, and high transaction costs. By providing accessible and affordable digital financial services, FinTech has the potential to strengthen financial inclusion and support Sustainable Development Goal 8 (SDG 8), which promotes sustained, inclusive, and sustainable economic growth.
Despite the growing relevance of FinTech, limited evidence exists regarding the factors influencing FinTech adoption among rural and urban MSMEs and how adoption contributes to financial inclusion. Moreover, sustainability-related factors remain underexplored within technology adoption research. To address these gaps, this study examines the determinants of FinTech adoption and its impact on financial inclusion among MSMEs in South Sumatra, Indonesia. The study applies an extended Unified Theory of Acceptance and Use of Technology (UTAUT) framework by incorporating digital financial literacy, artificial intelligence literacy, green self-identity, and perceived green finance.
Data were collected from 632 MSMEs, consisting of 377 rural enterprises and 255 urban enterprises. The proposed model was analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM), Multi-Group Analysis (MGA), and Importance Performance Map Analysis (IPMA). These methods allow the study to identify both the key drivers of FinTech adoption and the differences between rural and urban MSMEs.
The findings reveal significant heterogeneity across geographical contexts. For rural MSMEs, facilitating conditions emerge as the most influential determinant of FinTech adoption, indicating that digital infrastructure, internet accessibility, technical support, and institutional assistance are essential for encouraging the use of financial technologies. In contrast, effort expectancy is identified as the strongest determinant among urban MSMEs, suggesting that ease of use and user-friendly digital platforms are more important in environments where technological infrastructure is relatively developed. The MGA results further confirm that the strength of these relationships differs significantly between rural and urban enterprises, highlighting the importance of context-specific approaches to digital financial inclusion.
The results also demonstrate that FinTech adoption significantly enhances both FinTech continuance intention and financial inclusion among rural and urban MSMEs. These findings indicate that greater adoption of digital financial technologies enables MSMEs to access a wider range of financial services, including digital payments, financing facilities, and financial management tools. Improved access to these services can strengthen business resilience, facilitate market participation, and support enterprise growth, thereby contributing to the broader objectives of SDG 8 through enhanced economic participation and productivity.
The IPMA findings provide important practical insights. For rural MSMEs, facilitating conditions exhibit both high importance and strong performance effects, suggesting that investments in digital infrastructure, internet connectivity, training programs, and technical assistance should be prioritized. For urban MSMEs, improving the simplicity, usability, and user experience of FinTech applications appears to be the most effective strategy for increasing adoption. These findings imply that policymakers should move beyond one-size-fits-all approaches and develop targeted interventions tailored to the unique needs of rural and urban business environments. Financial institutions and FinTech providers can also leverage these insights by designing products and support services that address location-specific barriers to adoption.
This study contributes to the FinTech and financial inclusion literature by extending the UTAUT framework with sustainability-related constructs and providing evidence from a rural–urban perspective. More importantly, the findings offer actionable policy recommendations for governments, financial institutions, and FinTech providers seeking to accelerate digital financial inclusion among MSMEs and support inclusive economic growth in line with SDG 8.
Read the full article here to explore the detailed findings and their implications for both policymakers and practitioners.