Financial Technology Adoption and Its Impact on Financial Inclusion among Micro, Small, and Medium Enterprises

Financial technology (fintech) has increasingly transformed the financial landscape by providing Micro, Small, and Medium Enterprises (MSMEs) with greater access to financial services, digital payment systems, and alternative sources of financing. This study aims to examine the adoption of financial technology and its impact on financial inclusion among MSMEs. The study employs a literature review approach by synthesizing findings from previous empirical studies examining fintech adoption, financial inclusion, digital financial literacy, payment gateways, and MSME financial performance. The reviewed literature indicates that fintech adoption generally contributes positively to financial inclusion by reducing barriers to access, facilitating digital payments, expanding financing opportunities, and improving the efficiency of financial transactions. Fintech platforms also provide MSMEs with opportunities to access formal financial services that were previously difficult to obtain through conventional financial institutions. However, the extent of these benefits is influenced by several factors, including digital and financial literacy, perceived ease of use, security, trust, digital infrastructure, and regulatory support. The literature further suggests that increased financial inclusion through fintech can contribute to improved financial management, business performance, competitiveness, and sustainability of MSMEs. Nevertheless, challenges related to limited digital literacy, unequal technological infrastructure, regulatory uncertainty, and potential over-indebtedness remain important considerations. Therefore, strengthening digital financial literacy, expanding digital infrastructure, and developing supportive regulatory frameworks are essential to maximize the contribution of fintech adoption to inclusive and sustainable MSME development.