Determinants of MSMEs' access to finance: firm characteristics, financial delinquency, and fintech adoption

Abstrak

Limited access to financing remains a major obstacle for Micro, Small, and Medium Enterprises in expanding their businesses, particularly amid intensifying market competition and the rapid digitalization of the financial sector. This study offers novelty by integrating firm characteristics, financial delinquency, and fintech adoption within a single framework while examining the moderating role of government support in MSMEs' access to finance. This research aimed to analyze the effects of Firm Characteristics, Financial Delinquency, and Fintech Adoption on MSMEs' Access to Finance among MSMEs in Malang City. A quantitative approach was employed using proportionate stratified random sampling with 411 respondents. Data were analyzed using Partial Least Squares–Structural Equation Modeling (PLS-SEM) with SmartPLS. The findings indicate that Firm Characteristics, Financial Delinquency, Fintech Adoption, and Government Support positively and significantly affect Access to Finance. Fintech Adoption emerged as the strongest determinant. However, Government Support failed to moderate the relationships between the independent variables and Access to Finance. These findings suggest that MSMEs' financial accessibility is driven more by internal readiness and digital financial capability than by government intervention, particularly in developing-country contexts.