Improving financial performance through financial literacy, good financial practice and fintech adoption

Micro, Small, and Medium Enterprises (MSMEs) play a crucial role in economic development, contributing to employment generation and local revenue. However, their financial performance is influenced by several factors, including financial literacy, financial management practices, and financial technology (fintech) adoption. This study examines the relationship between these variables and the financial performance of MSMEs in Vigan City, Philippines. Employing a descriptive-correlational research design, data were collected from ninety (90) MSME owners and managers through a structured survey. The findings revealed that MSMEs in Vigan City exhibit a high level of financial literacy, financial management practices, and fintech adoption. However, gaps persist in the practical application of financial knowledge, long-term financial planning, and the utilization of fintech beyond basic transactions. Statistical analysis indicated a significant positive correlation between financial literacy, financial management practices, fintech adoption, and financial performance. These results suggest that strengthening financial education, encouraging proactive financial planning, and enhancing fintech integration can further improve MSME sustainability and profitability. This study provided valuable insights for policymakers, financial institutions, and MSME owners, offering strategic recommendations to enhance financial resilience, efficiency, and growth. By addressing key financial challenges, MSMEs in heritage cities like Vigan can achieve greater financial stability and long-term success.