Open Journal Systems

The Determinants of SMEs Intention to Adopt Sharia Crowdfunding for Financing Solutions

Chintia Alvina, Sumardi Sumardi, Ummu Salma Al Azizah

Abstract

This study aims to identify the variables that influence SMEs' decisions to use sharia crowdfunding in Indonesia as a source of funding. This research focuses on SMEs in Indonesia, which are rarely investigated in the existing literature on sharia crowdfunding. In addition, this study applies the technology acceptance model (TAM), which has not been widely used to identify factors that encourage the adoption of sharia crowdfunding. This study also employs non-probability sampling techniques in conjunction with a quantitative methodology. The data in this study were obtained through a questionnaire survey of 293 respondents obtained from SME owners and managers. The data analysis was conducted using PLS-SEM, while data processing was executed using SmartPLS 3.0. This research assists the government in designing programs and policies to encourage the expansion of SMEs in Indonesia through funding solutions with sharia crowdfunding. Therefore, SMEs have no difficulty in securing funding for their business.

Keywords

TAM; Fintech; Intention; SMEs; Sharia Crowdfunding

References

Al-Gahtani, S. S. (2011). Modeling the electronic transactions acceptance using an extended technology acceptance model. Applied Computing and Informatics, 9(1), 47–77. https://doi.org/10.1016/j.aci.2009.04.001

Al-Somali, S. A., Gholami, R., & Clegg, B. (2009). An investigation into the acceptance of online banking in Saudi Arabia. Technovation, 29(2), 130–141. https://doi.org/10.1016/j.technovation.2008.07.004

Arner, D. W., Barberist, J., & Buckley, R. P. (2015). The evolution of Fintech: A new post-crisis paradigm? (October 1, 2015). University of Hong Kong Faculty of Law Research Paper No. 2015/047, UNSW Law Research Paper No. 2016-62, http://dx.doi.org/10.2139/ssrn.2676553

Asutay, M. (2007). Conceptualisation on the Second Best Solution in Overcoming the Social Failure of Islamic Banking and Finance. IIUM Journal of Economics and Management, 15(2), 167–195. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1693608

Asutay, M. (2012). Conceptualising and locating the social failure of Islamic finance: Aspiration of Islamic moral economy vs. the realities of Islamic finance. Asian and African Area Studies, 11(2), 93–113.

Ayeh, J. K., Au, N., & Law, R. (2013). Predicting the intention to use consumer-generated media for travel planning. Tourism Management, 35(1), 132–143. https://doi.org/10.1016/j.tourman.2012.06.010

Bank Indonesia. (2022). Challenge of culture-based smes digitalisation. https://www.bi.go.id/en/bi-institute/BI-Epsilon/Pages/Tantangan-Digitalisasi-UMKM-Berbasis-Budaya.aspx

Beier, M., & Wagner, K. (2015). Crowdfunding success: A perspective from social media and e-commerce. ICIS 2015 Proceedings, 11. https://core.ac.uk/download/pdf/301367390.pdf

Belleflamme, P., Lambert, T., & Schwienbacher, A. (2013). Individual crowdfunding practices. Venture Capital, 15(4), 313–333. https://doi.org/10.1080/13691066.2013.785151

Borst, I., Moser, C., & Ferguson, J. (2018). From friendfunding to crowdfunding: Relevance of relationships, social media, and platform activities to crowdfunding performance. New Media and Society, 20(4), 1396–1414. https://doi.org/10.1177/1461444817694599

Chin, W. W. (1998). The partial least squares approach for structural equation modeling. In G. A. Marcoulides (Ed.), Modern methods for business research (pp. 295–336). Lawrence Erlbaum Associates Publishers. https://www.researchgate.net/publication/311766005

Choy, K., & Schlagwein, D. (2016). Crowdsourcing for a better world: On the relation between IT affordances and donor motivations in charitable crowdfunding. Information Technology and People, 29(1), 221–247. https://psycnet.apa.org/doi/10.1108/ITP-09-2014-0215

Cruz, P., Neto, L. B. F., Muñoz-Gallego, P., & Laukkanen, T. (2010). Mobile banking rollout in emerging markets: Evidence from Brazil. International Journal of Bank Marketing, 28(5), 342–371. https://doi.org/10.1108/02652321011064881

Davis, F. D. (1989). Perceived usefulness, perceived ease of use, and user acceptance of information technology. MIS Quarterly: Management Information Systems, 13(3), 319–339. https://doi.org/10.2307/249008

Davis, F. D., Bagozzi, R. P., & Warshaw, P. R. (1989). User acceptance of computer technology: A comparison of two theoretical models. Management Science, 35(8), 982–1003. http://dx.doi.org/10.1287/mnsc.35.8.982

Dresner, S. (2014). Crowdfunding: A guide to raising capital on the internet. Hoboken: John Wiley & Sons, Limited, 3. https://onlinelibrary.wiley.com/doi/book/10.1002/9781118746974

Gold, A. H., Malhotra, A., & Segars, A. H. (2001). Knowledge management : An organizational capabilities perspective. Journal of Management Information Systems, 18(1), 184–214. https://doi.org/10.1080/07421222.2001.11045669

Hair, J. F., Black, W. C., Babin, B. J., & Anderson, R. E. (2014). Multivariate data analysis (7th Eds.). Pearson Education Limited.

Hair, J. F., Hult, T. M., Ringle, C. M., & Sarstedt, M. (2017). A primer on partial least squares structural equation modeling (PLS-SEM) (2nd Eds). SAGE Publications, Inc.

Hair, J. F., Hult, T. M., Ringle, C. M., & Sarstedt, M. (2022). A primer on partial least squares structural equation modeling [PLS-SEM] (3rd Eds). SAGE Publications.

Hair, J. F., Risher, J. J., Sarstedt, M., & Ringle, C. M. (2019). When to use and how to report the results of PLS-SEM. Emerald Group Publishing, 31(1), 2–24. https://doi.org/10.1108/EBR-11-2018-0203

Hendratmi, A., Ryandono, M. N. H., & Sukmaningrum, P. S. (2020). Developing Sharia crowdfunding website platform for startup companies in Indonesia. Journal of Islamic Marketing, 11(5), 1041–1053. https://doi.org/10.1108/JIMA-02-2019-0022

Henseler, J., Ringle, C. M., & Sarstedt, M. (2015). A new criterion for assessing discriminant validity in variance-based structural equation modeling. Journal of the Academy of Marketing Science, 43(1), 115–135. https://doi.org/10.1007/s11747-014-0403-8

Hua, X., Huang, Y., & Zheng, Y. (2019). Current practices, new insights, and emerging trends of financial technologies. Industrial Management and Data Systems, 119(7), 1401–1410. https://doi.org/10.1108/IMDS-08-2019-0431

International Organization of Securities Commissions. (2017). IOSCO research report on financial technologies (Fintech). https://www.iosco.org/library/pubdocs/pdf/IOSCOPD554.pdf

Jaziri, R., & Miralam, M. (2019). Modelling the crowdfunding technology adoption among novice entrepreneurs: An extended TAM model. Entrepreneurship and Sustainability Issues, 7(1), 353–374. https://doi.org/10.9770/jesi.2019.7.1(26)

Kalogiannakis, M., & Papadakis, S. (2019). Evaluating pre-service kindergarten teachers’ intention to adopt and use tablets into teaching practice for natural sciences. International Journal of Mobile Learning and Organisation, 13(1), 113-127. https://doi.org/10.1504/IJMLO.2019.096479

Kazaure, M. A., Abdullah, A. R., Zawawi, D. B., & Hamzah, A. (2021). Determinants of SMEs intention to adopt sharia crowdfunding model in Northwestern Nigeria. Journal of Islamic Accounting and Business Research, 12(2), 204–217. https://doi.org/10.1108/JIABR-12-2019-0234

Liu, G., Huang, S. P., & Zhu, X. K. (2008). User acceptance of Internet banking in an uncertain and risky environment. Proceedings of International Conference on Risk Management and Engineering Management, 2003, 381–386. https://doi.org/10.1109/ICRMEM.2008.82

Lu, C.-T., Xie, S., Kong, X., & Yu, P. S. (2014). Inferring the impacts of social media on crowdfunding. Proceedings of the 7th ACM International Conference on Web Search and Data Mining, New York (25-28 February), 573–582. https://doi.org/10.1145/2556195.2556251

Maksum, I. R., Sri Rahayu, A. Y., & Kusumawardhani, D. (2020). A social enterprise approach to empowering micro, small and medium enterprises (SMEs) in Indonesia. Journal of Open Innovation: Technology, Market, and Complexity, 6(3). https://doi.org/10.3390/JOITMC6030050

Mathieson, K. (1991). Predicting user intentions: Comparing the technology acceptance model with the theory of planned behavior. Information Systems Research, 2(3), 173–191.

Menne, F., Surya, B., Yusuf, M., Suriani, S., Ruslan, M., & Iskandar, I. (2022). Optimizing the financial performance of SMES based on sharia economy: Perspective of economic business sustainability and open innovation. Journal of Open Innovation: Technology, Market, and Complexity, 8(1). https://doi.org/10.3390/joitmc8010018

Mollick, E. (2014). The dynamics of crowdfunding: An exploratory study. Journal of Business Venturing, 29(1), 1–16. https://doi.org/10.1016/j.jbusvent.2013.06.005

Muhamad, N. (2023). Usaha mikro tetap merajai UMKM, berapa jumlahnya? Databoks. https://databoks.katadata.co.id/datapublish/2023/10/13/usaha-mikro-tetap-merajai-umkm-berapa-jumlahnya#:~:text=Usaha mikro mencapai 63.955.369,total unit usaha di Indonesia

Müllerleile, T., Joenssen, D. W., & Müllerleile, A. (2014). Crisis, co-financing, and crowdfunding: Igniting regional development. Paper Presented at the International Conference for Entrepreneurship, Nicosia, Cyprus, 277–285. https://www.researchgate.net/profile/Dieter_Joenssen/publication/265476654_Mllerleile_T._Joenssen_D_Mllerleile_A._Crisis_Co-Financing_and_Crowdfunding_Igniting_Regional_Development._In_G._Papadopoulos_P._Ketikidis__S._Kofteros_(Eds.)_Proceedings_of_the_7t

Mustafida, R., Fauziah, N. N., & Kurnia, Z. N. (2021). The development of Sharia crowdfunding in Indonesia and its impact towards SMEs. Hasanuddin Economics and Business Review, 4(3), 20. https://doi.org/10.26487/hebr.v4i3.2547

Nivoix, S. and Ouchrif, F.Z. (2016), "Is Crowdfunding Sharia Compliant?", Méric, J., Maque, I. and Brabet, J. (Ed.) International Perspectives on Crowdfunding, Emerald Group Publishing Limited, Leeds, pp. 185-198. https://doi.org/10.1108/978-1-78560-315-020151011Pahlevi, R., Zulpahmi, Z., Al-Azizah, U. S., & Hasibuan, A. A. (2023). Adoption of fintech services for sharia bank users in Indonesia: An extended TAM approach. Equilibrium: Jurnal Ekonomi Syariah, 11(1), 27. https://doi.org/10.21043/equilibrium.v11i1.19641

Pikkarainen, T., Pikkarainen, K., Karjaluoto, H., & Pahnila, S. (2004). Consumer acceptance of online banking: An extension of the technology acceptance model. Internet Research, 14(3), 224–235. https://doi.org/10.1108/10662240410542652

Putri, G. A., Widagdo, A. K., & Setiawan, D. (2023). Analysis of financial technology acceptance of peer to peer lending (P2P lending) using extended technology acceptance model (TAM). Journal of Open Innovation: Technology, Market, and Complexity, 9(1), 100027. https://doi.org/10.1016/j.joitmc.2023.100027

Rahman, M. P., Mohd Thas Thaker, M. A., & Duasa, J. (2020). Developing a Sharīʿah-compliant equity-based crowdfunding framework for entrepreneurship development in Malaysia. ISRA International Journal of Islamic Finance, 12(2), 239–252. https://doi.org/10.1108/IJIF-07-2018-0085

Riswandi, B. A., Alfaqiih, A., & Wicaksono, L. S. (2023). Design of equity crowdfunding in the digital age. Laws, 12(1). https://doi.org/10.3390/laws12010008

Rodriguez-Ricardo, Y., Sicilia, M., & López, M. (2018). What drives crowdfunding participation? The influence of personal and social traits. Spanish Journal of Marketing - ESIC, 22(2), 163–182. https://doi.org/10.1108/SJME-03-2018-004

Roehrich, G. (2004). Consumer innovativeness: Concepts and measurements. Journal of Business Research, 57(6), 671–677. https://doi.org/10.1016/S0148-2963(02)00311-9

Rosavina, M., Rahadi, R. A., Kitri, M. L., Nuraeni, S., & Mayangsari, L. (2019). P2P lending adoption by SMEs in Indonesia. Qualitative Research in Financial Markets, 11(2), 260–279. https://doi.org/10.1108/QRFM-09-2018-0103

Sahaym, A., Datta, A., & Brooks, S. (2021). Crowdfunding success through social media: Going beyond entrepreneurial orientation in the context of small and medium-sized enterprises. Journal of Business Research, 125(November 2018), 483–494. https://doi.org/10.1016/j.jbusres.2019.09.026

Sulaiman, S. M., Muhammad, Y., & Muhammad, M. A. (2021). An assessment of the intention to accept the shariah-compliant crowdfunding mode of financing in Borno State, Nigeria. Journal of Islamic Monetary Economics and Finance, 7(4), 687–708. https://doi.org/10.21098/jimf.v7i4.1271

Sumardi, Azizah, U. S. Al, Mulyono, H., & Suryana, A. M. (2022). The determinants of willingness to continuously use financial technology among university students: Dataset from a private university in Indonesia. Data in Brief, 44, 108521. https://doi.org/10.1016/j.dib.2022.108521

Suryono, R. R., Budi, I., & Purwandari, B. (2020). Challenges and trends of financial technology (Fintech): A systematic literature review. Information (Switzerland), 11(12), 1–20. https://doi.org/10.3390/info11120590

Tambunan, T. (2019). Recent evidence of the development of micro, small and medium enterprises in Indonesia. Journal of Global Entrepreneurship Research, 9(1). https://doi.org/10.1186/s40497-018-0140-4

Tamimi, A., & Ahmad, M. (2020). Online repatronage intention: An online system usage and purchase experience perspective. BITARA International Journal of Civilizational Studies and Human Sciences, 3(1), 001–009. http://dx.doi.org/10.46886/IJARBSS/v10-i3/7068

Teo, T. S. H., Srivastava, S. C., & Jiang, L. (2008). Trust and electronic government success : An empirical study. Journal of Management Information Systems, 25(3), 99–132. https://doi.org/10.2753/MIS0742-1222250303

Thaker, M. A. B. T. (2019). Modelling SMES’ behavioral intention to adopt Islamic crowdfunding-small and medium enterprises (ICSMES) model as a source of financing in Malaysia. Journal of Islamic Monetary Economics and Finance, 4(2), 2460–6618. https://doi.org/10.21098/jimf.v4i2.961

Tobias, R. D. (1995). An introduction to partial least squares regression. Proceedings of the Twentieth Annual SAS Users Group. https://stats.oarc.ucla.edu/wp-content/uploads/2016/02/pls.pdf

Wang, N., Li, Q., Liang, H., Ye, T., & Ge, S. (2018). Understanding the importance of interaction between creators and backers in crowdfunding success. Electronic Commerce Research and Applications, 27, 106–117. https://doi.org/10.1016/j.elerap.2017.12.004

Wojciechowski, A. (2009). Models of Charity Donations and Project Funding in Social Networks. In: Meersman, R., Herrero, P., Dillon, T. (eds) On the Move to Meaningful Internet Systems: OTM 2009 Workshops. OTM 2009. Lecture Notes in Computer Science, vol 5872. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-05290-3_58

Yu, S., Johnson, S., Lai, C., Cricelli, A., & Fleming, L. (2017). Crowdfunding and regional entrepreneurial investment: an application of the CrowdBerkeley database. Research Policy, 46(10), 1723–1737. https://doi.org/10.1016/j.respol.2017.07.008

Full Text: PDF

DOI: 10.21043/equilibrium.v12i1.26125