Tech–Gender Empowerment in Women-Managed MSMEs: How Digital Financial Capability and Transformational Leadership Build Competitiveness

Abstract

This study examines how digital financial capability and women’s transformational leadership shape the competitiveness of women-managed micro, small, and medium enterprises (MSMEs) and develops the Tech–Gender Empowerment framework to explain how these capabilities complement each other in a digitalising business environment. Using a sequential explanatory mixed-method design, the quantitative stage employed Partial Least Squares Structural Equation Modelling (PLS-SEM) to assess the relationships among digital financial capability, women’s transformational leadership, and MSME competitiveness, while the qualitative stage used NVivo-assisted thematic coding to explain how financial technology use, leadership practices, and business adaptation interact in everyday MSME management. The study targeted women-managed MSMEs in Medan, Indonesia. Results show that digital financial capability significantly affects MSME competitiveness (β = 0.448, t = 6.893, p < 0.001), as does women’s transformational leadership (β = 0.273, t = 4.003, p < 0.001). Together, these predictors explain 41.3% of the variance in competitiveness. Qualitative findings indicate that digital financial capability involves understanding digital financial services, managing transactions, controlling digital risks, and using financial information for decision-making, while transformational leadership supports vision, intellectual stimulation, individualised support, and digital innovation. The study contributes by conceptualising digital financial capability as an organisational capability and women’s transformational leadership as a change-oriented capability, integrated through the Tech–Gender Empowerment framework. Despite limitations related to its cross-sectional design and focus on Medan, the findings suggest that women-focused MSME programmes should integrate digital financial literacy, risk management, evidence-based decision-making, and leadership development to strengthen sustainable digital adoption and competitiveness.