The Antecedents of MSME Sustainability with Financial Behavior as Intervening Variable

Abstract

MSMEs are an important pillar for a country's economy through their contribution to GDP and job creation. The development of MSMEs in Sleman Regency is accompanied by technological developments considering the high economic potential and growth of MSMEs in the region as previously explained. It is very interesting to study in the context of MSMEs in Sleman Regency which have great potential in regional economic development, but are indicated to face challenges in the sustainability of MSMEs due to various factors of misused financial technology advances such as online loans. MSME actors in Sleman Regency who lack understanding of financial aspects make the MSMEs they run go bankrupt due to high interest from illegal online loans. This study aims to empirically test the effect of financial literacy, financial inclusion, and fintech on the sustainability of MSMEs with financial behavior as an intervening variable. The type of data used in this study is primary data using quantitative methods. This study was conducted on MSME actors in Sleman Regency who use fintech with a total of 233 respondents processed. The sampling method uses a purposive sampling technique and data was taken in October – November 2024. Hypothesis testing in this study uses the SmartPLS4 application as a data processing tool. The results of this study indicate that financial literacy, fintech, and financial behavior have a positive effect on the sustainability of MSMEs, while financial inclusion does not affect the sustainability of MSMEs. Financial literacy and financial inclusion have a positive effect on financial behavior, while fintech does not affect financial behavior. And financial behavior mediates the positive influence of financial literacy, financial inclusion on the sustainability of MSMEs, while financial behavior does not mediate the influence of fintech on the sustainability of MSMEs.