V3I3P20

FinTech Adoption and the Sustainability of Informal Businesses in South-East Nigeria: A Dynamic Capabilities and Institutional Voids Perspective

Anzor, Edith Chima, Ph.D^1*, Ihionu, Marcellinus Chukwuka, Ph.D², Ochiaka, Dennis Iyidiobi, PhD³

Abstract

International business (IB) research has traditionally focused on formal firms, overlooking the substantial role of informal enterprises in emerging economies. This study investigates how FinTech adoption influences the sustainability and quasi-internationalization of informal businesses in South-East Nigeria, integrating Dynamic Capabilities Theory with the Institutional Voids framework. Using a proposed survey of 300 informal enterprises, the study examines how digital financial tools—such as mobile payments, digital lending, and online transaction platforms—enhance sensing, seizing, and reconfiguring capabilities, thereby mitigating the liability of informality. Structural equation modeling (PLS-SEM) is employed to test hypothesized relationships, including mediation by dynamic capabilities and sustainability, and moderation by institutional void intensity. The study contributes to IB theory by (1) extending internationalization research to informal firms, (2) conceptualizing the liability of informality, (3) positioning FinTech as an institution-substituting mechanism, and (4) linking digital finance adoption to micro-level pathways of cross-border participation. Findings provide actionable insights for policymakers, financial service providers, and development practitioners seeking to promote inclusive economic growth through technology-enabled entrepreneurship.

Keywords:

FinTech adoption, informal enterprises, dynamic capabilities, institutional voids, quasi-internationalization, South-East Nigeria