FinTech governance and firms’ performance: Does financial literacy matter?

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Abstract

Through harnessing innovative technologies, financial technology (FinTech) services streamline and organize access to capital, improve operational effectiveness, and facilitate various transactions, enabling small and medium-sized enterprises (SMEs) to thrive in competitive and complex economies. The purpose of this research is to examine whether financial literacy (FL) moderate the relationship between FinTech indicators and SMEs’ performance in the Jordanian context. SMEs’ performance was measured by the operational and financial indicators. While the Fintech indicators were: financial inclusion (FI), trust in FinTech (TF), alternative payment methods (APMs), and perceived risk (PR). Data have been collected using a developed questionnaire. The study’s population was the SMEs in Jordan. Utilizing structural equation modeling (SEM) to analyse the collected 172 questionnaires, the results revealed that FinTech indicators have a significantly positive effect on SMEs’ performance. FL moderates the relationship of FinTech indicators with SMEs’ performance. The current study contributes to the existing research regarding the FinTech, FL and SMEs’ performance. The current research contributed to the literature by examining new variables, namely, FI, APMs, TF, and PR. The outcomes of this study highlight the importance of FinTech services in enhancing SMEs’ performance. Such outcomes indicate that SMEs in Jordan are strongly benefiting from FL and FinTech indicators.

Keywords: FinTech, SMEs’ performance, Financial Literacy, Financial Inclusion, Trust in FinTech, Perceived Risk

Authors’ individual contribution: Conceptualization — M.K.A.Z., H.K.Q., and A.A.-A.; Methodology — H.K.Q.; Investigation — H.K.Q. and A.A.-A.; Resources — M.K.A.Z., H.K.Q., and A.A.-A.; Writing — Original Draft — M.K.A.Z., H.K.Q., and A.A.-A.; Review & Editing — H.K.Q.; Supervision — M.K.A.Z. and H.K.Q.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: L21, L230, L250, O310

Received: 09.07.2024
Revised: 08.11.2024; 19.02.2025; 18.06.2025
Accepted: 14.07.2025
Published online: 18.07.2025

How to cite this paper: Al Zobi, M. K., Qawqzeh, H. K., & Abu-Allan, A. (2025). FinTech governance and firms’ performance: Does financial literacy matter? Journal of Governance & Regulation, 14(3), 39–48. https://doi.org/10.22495/jgrv14i3art4