Mediating Role of I-Fintech Adoption between Government Support, Digital Financial Literacy and Sustainable Entrepreneurship of Malaysian Bumiputera MSMEs

The rapid digitalisation of the financial sector has created new opportunities for MSMEs to enhance their competitiveness and achieve sustainable entrepreneurship. In Malaysia, i-FinTech has emerged as an innovative mechanism for improving financial inclusion and supporting the sustainable growth of Bumiputera-owned MSMEs through Shariah-compliant digital financial services. Despite extensive government initiatives promoting digital entrepreneurship, the mechanisms through which government support and digital financial literacy contribute to sustainable entrepreneurship remain insufficiently understood. Accordingly, this study examines the mediating role of i-FinTech adoption in the relationships between government support, digital financial literacy, and sustainable entrepreneurship among Malaysian Bumiputera MSMEs. A quantitative cross-sectional research design was employed, and data were collected from 1,394 Bumiputera MSME owners using a structured questionnaire. The proposed research model was analysed using PLS-SEM. The findings indicate that government support has a significant positive effect on both sustainable entrepreneurship and i-FinTech adoption. Similarly, i-FinTech adoption significantly enhances sustainable entrepreneurship. However, digital financial literacy does not significantly influence either sustainable entrepreneurship or i-FinTech adoption. Mediation analysis further reveals that i-FinTech adoption partially mediates the relationship between government support and sustainable entrepreneurship but does not mediate the relationship between digital financial literacy and sustainable entrepreneurship. These findings highlight the pivotal role of institutional support in accelerating i-FinTech adoption and promoting sustainable entrepreneurial development among Bumiputera MSMEs. The study contributes to the literature by integrating Institutional Theory and the Resource-Based View to explain sustainable entrepreneurship within the context of Islamic financial technology. The findings also provide practical implications for policymakers and entrepreneurship development agencies in designing integrated strategies that combine government support with digital financial innovation to strengthen the sustainability of Bumiputera MSMEs.

Sustainable Entrepreneurship; Government Support; Digital Financial Literacy; i-FinTech Adoption; Bumiputera MSMEs

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