The Role of Fintech on the Performance of Manufacturing SMEs in Dar es Salaam City, Tanzania

Abstract

The purpose of the study was to investigate the impacts of Fintech on the financial performance of manufacturing Small and Medium Enterprises (SMEs) in Dar es Sa-laam City, Tanzania. A cross-sectional survey research design was conducted to randomly sample 284 manufacturing SMEs from the population of 2867 SMEs locat-ed in Ilala District, which is situated in the Dar es Salaam City. In this quantitative study a questionnaire was used to gather data from SMEs owners/managers. The collected data were analysed using descriptive statistics such as mean, standard deviation and range to map the extent Fintech is adopted and used in SMEs; and the multiple regression model was performed to estimate the impact of Fintech on finan-cial performance of manufacturing SMEs. The descriptive findings show that the adoption and use of digital banking, mobile money services and peer-to-peer lending is higher among manufacturing SMEs. The estimation of regression model revealed that, predictors; digital banking, mobile money services and peer-to-peer lending have positive and statistically significant impact on SMEs financial performance. Accordingly, this study concludes that Fintech are valuable to financial performance of manufacturing SMEs. Thus, it is recommended to SMEs to increase the applica-tion and utilization of digital banking, mobile money services and peer-to-peer lending platforms for the efficient business operations.