The influence of small and medium-sized enterprise financial literacy on Fintech adoption in a fourth industrial revolution era

Background: The fourth industrial revolution has introduced transformative technologies redefining business operations, particularly for small and medium-sized enterprises (SMEs). Yet, limited financial literacy remains a significant barrier to fintech adoption, especially in developing economies. Aim: This study examined the role of financial literacy in influencing fintech adoption among SMEs. Setting: The study focused on SMEs in Zimbabwe, a developing economy where financial and technological inclusion remained a critical challenge. Method: The study adopted a quantitative cross-sectional design. Data were collected through an online questionnaire from 221 SME owners and managers. A probit regression model was employed to test hypotheses on the relationship between financial literacy and fintech adoption. Results: The findings revealed a statistically significant positive relationship between financial literacy and fintech adoption. Higher numerical and digital financial literacy levels increased the likelihood of fintech adoption, with digital literacy having a more substantial predictive effect. In addition, trust in financial products, transparency and income levels positively influenced adoption rates. Conclusion: Financial literacy in both the numerical and digital dimensions was a critical enabler of fintech adoption, underscoring the need for targeted education programmes. Policies addressing gaps in numerical and digital literacy, coupled with trust-building measures such as data protection policies, were essential for fostering widespread adoption. Contribution: This study advances understanding of the interplay between financial literacy and fintech adoption in a developing economy context. It provided practical insights for policymakers, educators and SME stakeholders, highlighting financial literacy as a key driver of technological integration and sustainable business development.