Effect of Financial Technology Adoption on the Performance of Small and Medium Enterprises in Kogi State, Nigeria

Abstract

This study examined the effect of financial technology (FinTech) adoption on the performance of Small and Medium Enterprises (SMEs) in Kogi State, Nigeria. Specifically, the study investigated the effects of perceived usefulness and agent credibility on SME performance, assessed the mediating role of customer experience, and examined the moderating influence of financial literacy and managerial digital capability. The study adopted a quantitative cross-sectional survey research design. The target population comprised 15,842 registered SMEs in Kogi State, from which a sample size of 390 respondents was derived using Yamane’s sampling formula. Data were collected through structured questionnaires administered to SME owners and managers using stratified and simple random sampling techniques. A total of 352 valid questionnaires were analyzed using descriptive statistics, multiple regression analysis, and Hayes PROCESS macro Models 4 and 2 with the aid of SPSS and IBM AMOS. The findings revealed that perceived usefulness and agent credibility had significant positive effects on SME performance. The study further found that customer experience significantly mediated the relationship between FinTech adoption and SME performance, while financial literacy and managerial digital capability significantly moderated the relationship. The study concluded that effective FinTech adoption enhances operational efficiency, competitiveness, and sustainability of SMEs. The study recommended increased investment in digital financial literacy, improvement in FinTech service credibility and security, and greater managerial support for digital innovation among SMEs. The study contributes to the growing literature on FinTech adoption and SME development in emerging economies, particularly within the context of North Central Nigeria.