Analyzing the Factors Causing MSMEs Resistant in Adopting Digital Technology

This research aims to provide an in-depth analysis of the factors that contribute to the lack of digital technology adoption among MSMEs in Indonesia. However, MSMEs in Indonesia are still lacking in using digital technology. The goal of this study is to investigate the variables that impact low level of digital technology adoption by MSMEs. In this research, the method used is quantitative by distributing questionnaires to MSMEs for data collection. From the results of data collection, a total of 290 data have been collected. Respondents from this questionnaires are MSMEs owners, and MSMEs managers, who are domiciled in the JABODETABEK area, data collection was carried out for 2 months since January. The data result is processed using SmartPLS4 software. The current research focuses on the following six contextual factors: MSMEs Context, Technological Context, Environmental Context, Perceived Usefulness, Perceived Ease of Use, and Intention to Use Digital Technology. The primary focus is to explore barriers and drivers impacting technology adoption by MSMEs. The findings are aimed at the formulation of concrete and robust strategies and policies that would enable MSMEs to achieve their goals regarding digital transformation. Out of the eight formulated hypotheses, seven were proved true and one was disproved which suggests that the majority of the examined variables do influence the intention of MSMEs towards adoption of digital technology.