Empowering small and medium enterprises: A model for digital literacy and credit utilization

Abstract

This study aims to analyze the development of SMEs based on literacy and the use of credit facilities for innovative and competitive business development. The research was conducted using the survey method, and the data were analyzed for quantitative modeling. The population in this study consisted of Jakpreneur MSMEs totaling 1,251 individuals. The sample size was set at 275 participants. The analysis focused on SME development factors related to digital literacy and the utilization of credit facilities, emphasizing the process of access to finance for SMEs in developing their businesses both financially and productively. The conclusion indicates that digital literacy has a significant impact on the use of credit facilities and business development. The use of credit facilities also mediates the relationship between digital literacy and business growth, partially explaining how digital literacy contributes to business development. This research provides practical implications for the importance of enhancing digital literacy among MSMEs by optimizing the benefits of credit facilities for business development, as it can increase access to productive finance. Future researchers are encouraged to examine variables such as location, education and training, creativity, innovation, and other aspects related to digital Industry 4.0 capabilities.