The role of Islamic crowdfunding and the mediating effect of technology adoption on SMEs’ sustainability

Abstract

Due to the excessively strict procedures enforced by financial institutions and government authorities, MSMEs in Malaysia are struggling to sustain especially during Covid 19 pandemic. To address this critical issue, with the advance in technology, entrepreneurs have become more independent and creative in raising capital through a process known as crowdfunding. This study intends to examine the relationship between Islamic crowdfunding, financial literacy, and technology adoption toward MSME’s sustainability during Covid 19 pandemic. Based on the random sample of 259 MSMEs, we assessed the correlation between all the variables using SmartPLS 3.3. The result showed that Islamic crowdfunding, financial literacy, and technology adoption affects positively on MSMEs’ sustainability. The results also indicate that financial literacy was the most influencing factor towards MSMEs’ sustainability during the Covid 19 pandemic situation.