A Panel Data Econometric Analysis on the Impact of Digital Payment Adoption on Small Business Revenue Growth in Global Business

Abstract

This study addresses the persistent problem that many small businesses adopt digital payments, yet the revenue impact remains uneven because adoption is often shallow and not operationally integrated. The purpose was to quantify how digital payment adoption and adoption maturity influence small business revenue growth and to test which adoption drivers strengthen or constrain this relationship. Using a quantitative, cross-sectional, case-based design, data were collected from N = 240 small businesses as enterprise-style operational cases embedded in cloud-enabled and platform-mediated payment ecosystems (for example, wallet, QR, POS gateway, and settlement services). The sample covered retail (38%), food/service (34%), and other transaction-intensive firms (28%), with most respondents being owners or general managers (71%) who manage payment decisions. Key variables included Digital Payment Adoption (ADOPT), Digital Payment Adoption Maturity Index (DPAMI), perceived ease of use (PEOU), trust/security perception (TR), perceived transaction cost (COST), customer preference for digital payment (CUSTPREF), and a triangulated Revenue Growth Composite (REVCOMP), with controls for firm size, firm age, sector, location, and sales-channel mix. The analysis plan applied scale reliability tests (Cronbach’s alpha), descriptive statistics, Pearson correlations, interaction and subgroup tests, and diagnostics (VIF). Measurement reliability was strong (for example, REVCOMP α = .88, TR α = .86, PEOU α = .83). Descriptives showed high adoption (ADOPT M = 3.74, SD = 0.71) and positive revenue outcomes (REVCOMP M = 3.49, SD = 0.69). Revenue growth correlated with adoption (r = .46, p < .001) and more strongly with maturity (DPAMI r = .54, p < .001). In regression, adding adoption increased model fit (Adj. R² = .27) with a significant effect (β = .31, p < .001), while adding maturity improved fit further (Adj. R² = .34) with a stronger effect (DPAMI β = .39, p < .001). Trust and usability promoted adoption (TR β = .33, p < .001; PEOU β = .28, p < .001), while cost constrained it (COST β = −.21, p = .002); the adoption–growth link strengthened when customers preferred digital payments (Adoption × CUSTPREF β = .17, p = .011). Implications suggest that SMEs should prioritize maturity practices (integration, staff readiness, reconciliation discipline), providers should reduce friction and strengthen trust signals, and policymakers should support interoperability and transparent pricing to help firms convert adoption into measurable growth.