Determinants of fintech adoption: evidence from SMEs in Indonesia

Abstract

Purpose – This study aims to explore the factors that determine the perceived benefits and the perceived risks of financial technology (fintech) and to evaluate the influence of perceived benefits, perceived risks and small and medium-sized enterprises’ (SMEs') trust to continue using fintech. Design/methodology/approach – This study involves SMEs in Indonesia. Non-probability with a convenience sampling technique was used in this study. Findings – Convenience and economic benefits can explain the perceived benefits. Operational risk is stated as a risk factor felt by the respondents. Furthermore, the perceived benefits have a positive effect and the perceived risks show a negative effect on trust. At the same time, the individuals’ intention to continue using fintech is determined by trust. Research limitations/implications – Based on the theory of reasoned action (TRA), various benefits and risks of using fintech are used to build the construction of perceived benefits and perceived risk in building trust that will determine decision to continue using fintech. Practical implications – This research can provide advice to managers to develop efficient payment systems, lower payment fee and error-free transactions. In addition, the fintech management needs to understand the risks related to operational risks that are a challenge for the users to decide to use fintech so that a reliable mechanism for using fintech can be developed. Furthermore, it will be useful for fintech developing companies as a reference in knowing the factors that influence users in continuing to use fintech, this allows fintech developing companies in Indonesia will be even more developed and accelerate the achievement of the Sustainable Development Goals. Originality/value – To the best of the authors’ knowledge, research on the factors that affect the trust of SMEs in adopting fintech has not been conducted. This study can be advantageous for fintech service companies and organizers in developing fintech strategies in terms of users who are involved in SMEs which is the population in Indonesia is enormous and has a significant role in the development of the country.

Keywords

• Behavior
• Intention to continue using fintech
• Trust
• Fintech
• SMEs
• Perceived benefits