Resistance of Traditional SMEs in Using Digital Payments: Development of Innovation Resistance Theory

The impact of the pandemic has also affected the sustainability of traditional traders. One of the merchants' efforts in overcoming the effect of COVID-19 is to make transactions with digital payments, both in-store purchases and through online media. This study is aimed at determining user resistance with the innovation resistance theory (IRT) approach based on two main approaches, namely, functional and psychological barriers. The unit of analysis in this study is a traditional clothing market trader who uses digital payments to process transactions. This study uses a qualitative method with a case study approach in Indonesia's traditional clothing market through in-depth interviews of eight respondents. The results of this study prove that the clothing market sword uses digital payments when conducting transactions directly to consumers and for the needs of traders in supporting their business activities such as bill payments and purchases to suppliers. Most buyers complain about the risk barrier on the security and privacy factor, especially when they experience delays in information when processing transactions, causing more efforts to make complaints. The research contributes to the development of IRT theory, especially in the context of technology such as digital payments. The results of this study can also be helpful for service providers and the government in making strategies and policies that can protect users, especially buyers and sellers, in adopting digital payments.