The Role of Financial Technology in Enhancing Financial Reporting Quality in SMEs

Afwil Jazil

Authors

Afwil Jazil Universitas Ibrahimy Author

Keywords:

Financial technology, Financial reporting quality, SMEs, Digital accounting, Bookkeeping practices

Abstract

This study aims to analyze the role of financial technology in enhancing financial reporting quality in small and medium-sized enterprises (SMEs). The study addresses the growing use of digital payment systems, mobile banking, digital wallets, marketplace platforms, and bookkeeping applications among SMEs, while also examining the gap between fintech adoption and the preparation of reliable financial reports. A qualitative case study approach was used, involving selected SME owners, managers, administrative staff, SME mentors, and accounting consultants in Central Java, Indonesia. Data were collected through semi-structured interviews, limited participant observation, and documentation of transaction records, digital payment receipts, and bookkeeping files. The data were analyzed using thematic analysis through coding, categorization, theme development, and interpretation. The findings reveal six main themes: digital transaction visibility, improved recording discipline, trust in financial data, fintech-based decision-making, fragmented digital records, and the influence of family-based business culture on reporting practices. The study shows that fintech can improve financial reporting quality by providing traceable transaction evidence and supporting more systematic bookkeeping. However, its impact depends on accounting literacy, digital competence, reporting routines, and data integration across different platforms. This study contributes to fintech and accounting information systems literature by framing fintech as a socio-technical practice. The findings imply that SME digitalization programs should combine fintech adoption with accounting training, simple reporting tools, and policy support for integrated financial data management.

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