Environmental Factors Affecting the Acceleration of Financial Technology (Fintech) Adoption by SMEs in the East Java Region

Abstract

Purpose – This study aimed to help define the environmental factors affecting the acceleration of FinTech adoption by SMEs in the East Java Region. Design/methodology/approach – An empirical study of TOE Framework focused on environmental factors using the data from 402 respondents of SMEs Owners and Managers who have already implemented OVO e-wallet in their business. Primary data was analyzed using SEM-PLS. Finding – The high competition in industry has no connection with the acceleration of FinTech adoption. Environmental variables conclude the prediction 75,8% of FinTech adoption. The most interesting finding among the three factors in environmental factors is only the support from government and vendor that significantly accelerate the fintech adoption by SMEs in the East Java Region. The finding suggested that vendors must actively offer the e-wallet payment services and provide training to merchants. Government support has also shown to be a significant antecedent toward consumers’ intention to use the e-wallet payment services.