Exploring the Influence of Financial Literacy on Adoption of Digital Payment Systems by Small-Scale Merchants

This study investigates the influence of financial literacy on the acceptance of digital payment systems among small-scale merchants, aiming to uncover the factors that affect this adoption process. The research used Smart PLS4 software to analyse data and evaluate the impact of different levels of financial literacy on merchants’ propensity to embrace digital payment methods. The findings indicate that merchants with a higher degree of financial literacy are more inclined to use digital payment systems, seeing the benefits of enhanced financial management and more convenience for consumers. On the other hand, those with less financial literacy display more caution due to concerns about the security and complexity of digital systems. This study offers valuable insights into the barriers and incentives for accepting digital payments and suggests the need for targeted financial education programs to support small businesses in embracing new technology.