A MODEL TO INCREASE SME’S PERFORMANCE: THE MODERATING ROLE OF SOCIAL CAPITAL

Abstract

This study aims to analyze the performance improvement model of SMEs with the role of social capital as a moderating variable. The rapid development of technology and information in the era of digitalization has become an inseparable part of people around the world, including in Indonesia. The use of technology provides many conveniences for the community in supporting every activity and
activity. In this case, Micro, Small and Medium Enterprises (SMEs) are one of the drivers of the people's economy and play an important role in national economic growth. This study will examine the role of financial technology and financial inclusion as determinants of SMEs performance. Then this study will
also examine the moderating role of social capital in supporting the improvement of SMEs performance. The method that will be used is explanatory research with a quantitative approach. The sampling method that will be used in this research is purposive sampling. Respondents who will be used in this study consist of 100 SMEs actors in Central Java and their business financing has used loan
funds and digital literacy. Data collection will be done by using a questionnaire via google form. The data analysis that will be used is Smart PLS type 3.3. The results of the study indicate that financial technology and financial inclusion have a positive and significant impact on the performance of SMEs.
Meanwhile, social capital mediates the relationship between financial technology and SMEs performance. And social capital mediates the relationship between financial inclusion and SMEs performance