The Mediating Role of Financial Literacy in the Relationship Between Financial Digitalization and the Operational Performance of Automotive SMEs in Lubuklinggau City

Abstract

This study aims to analyze the effect of financial digitalization on the operational performance of Micro, Small, and Medium Enterprises (MSMEs) in the automotive sector in Lubuklinggau City, with financial literacy as a mediating variable. This research is motivated by the low level of technology adoption caused by limited knowledge, constrained access to devices, and the perception that financial digitalization is complex for micro-enterprises. In addition, the operational performance of automotive MSMEs in Lubuklinggau City has not yet been optimal in terms of time efficiency, cost efficiency, and business productivity. Furthermore, a lack of understanding of financial planning, working capital management, and the separation of personal and business finances has led many financial decisions to be made intuitively. The population and sample of this study consisted of all automotive sector MSMEs in Lubuklinggau City, totaling 177 business units. Data were collected through questionnaires, observations, and documentation. This study employed a causal associative quantitative approach using Structural Equation Modeling–Partial Least Squares (SEM-PLS) analysis with the SmartPLS software through a bootstrapping procedure. The results of the analysis indicate that financial digitalization has a positive and significant effect on operational performance, with a T-statistic value of 11.136 and a p-value of 0.000. Financial literacy also has a positive and significant effect on operational performance, with a T-statistic value of 6.224 and a p-value of 0.000. Furthermore, financial literacy is proven to mediate the effect of financial digitalization on operational performance, with a T-statistic value of 6.114 and a p-value of 0.000.

Keywords : Financial Digitalization, Financial Literacy, Operational Efficiency