The Influence of Social Media and Technology on Financial Circulation in Karangtengah District through Economic Activities

Abstract

The development of social media and digital technology has changed the way people transact, yet studies examining their effect on financial turnover at the sub-district level remain limited. This study aims to analyze the effect of social media and technology on community financial turnover in Karangtengah Sub-district, Cianjur Regency, with economic activity as a mediating variable. A quantitative associative approach was used, with primary data collected through questionnaires from 150 respondents selected by purposive sampling. The data were analyzed using Structural Equation Modeling-Partial Least Squares (SEM-PLS) with SmartPLS 3. The results show that social media has no significant direct effect on financial turnover (β = 0.157; p = 0.079), whereas technology has a positive and significant direct effect (β = 0.250; p = 0.003). Social media and technology both have positive and significant effects on economic activity, and economic activity significantly affects financial turnover (β = 0.497). Economic activity fully mediates the effect of social media and partially mediates the effect of technology on financial turnover. Local governments and business actors are recommended to strengthen digital literacy and to convert social media interactions into real transactions.