Mochammad Fahlevi, Aulia Luqman Aziz, Mohammed Aljuaid, Sebastian Saniuk, Sandra Grabowska
This study examines the role of financial awareness (FA), financial capability (FC), and their influence on risky financial behaviors—risky paying behavior (RPB), risky borrowing behavior (RBB), and financial goals (FGs)—among agro-industrial MSMEs in East Java. This study also explores the moderating effects of expected future financial security (EFFS) and current money management stress (CMMS) in the context of seasonal income fluctuations. This study employed a quantitative approach using structural equation modeling (SEM) with SmartPLS 4. Data were collected through surveys with 287 MSME owners in six cities/regencies in East Java, selected using a random sampling method. The research variables were measured using validated scales adapted from previous studies. FA significantly influenced FC, RPB, and RBB, whereas FC positively impacted FG. RPB had a strong positive effect on FG, whereas RBB showed no significant relationship. The mediation effect of FC between FA and FG was significant, highlighting its pivotal role in achieving FG. However, the moderating effects of EFFS and CMMS on the FC–FG relationship were not significant, suggesting their limited direct impact in this context. This study reveals the urgent need for tailored financial literacy programs that address specific issues faced by MSME owners, such as managing irregular cash flows and minimizing risky financial behavior. Financial institutions should develop accessible financial tools and products for agro-industrial MSMEs. © 2025 by the authors.
Management Department, BINUS Online, Bina Nusantara University, Jakarta, 11480, Indonesia; Research & Management Sciences, Faculty of Business and Management, Universiti Sultan Zainal Abidin (UniSZA), Kuala Terengganu, 21300, Malaysia; Faculty of Administrative Science, Universitas Brawijaya, Malang, 65145, Indonesia; Department of Health Administration, College of Business Administration, King Saud University, Riyadh, 11437, Saudi Arabia; Department of Engineering Management and Logistic Systems, University of Zielona Gora, Zielona Gora, 65-417, Poland; Department of Production Engineering, Silesian University of Technology, Gliwice, 40-019, Poland
