The Importance of Accounting Digitalization for Micro, Small, and Medium Enterprises (MSMEs)

In the era of digital transformation, Micro, Small, and Medium Enterprises (MSMEs) are required to improve efficiency and transparency in financial management. One of the main strategies that can be implemented is accounting digitalization, namely the use of digital-based technology to systematically record, process, and present financial information. This study aims to examine the importance of accounting digitalization for MSMEs in improving operational efficiency, financial reporting accuracy, and expanding access to formal financing. Using a literature study approach, this article analyzes various empirical and conceptual findings from relevant previous research. The results of the study indicate that accounting digitalization not only improves the accuracy and speed of financial recording but also encourages transparency, accountability, and credibility of financial reports required by financial institutions, investors, and regulators. Therefore, the adoption of accounting digitalization is an urgent need for MSMEs in facing the dynamics of the digital economy and increasingly fierce market competition.