<![CDATA[Entrepreneurial resilience has become a critical capability that enables small and medium-sized enterprises (SMEs) to survive, adapt, and sustain business performance amid increasing economic uncertainty. Although previous studies have extensively examined the determinants of entrepreneurial resilience, limited attention has been given to the strategic role of Islamic financial capability and the mechanisms through which it enhances resilience. This study investigates the effect of Islamic financial capability on entrepreneurial resilience by examining the sequential mediating roles of risk management capability and sharia-based financial resilience. A quantitative explanatory research design was employed using survey data collected from 355 SME owners in the Special Region of Yogyakarta, Indonesia. Data were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The findings indicate that Islamic financial capability significantly strengthens entrepreneurial resilience both directly and indirectly through risk management capability and sharia-based financial resilience. Furthermore, risk management capability enhances sharia-based financial resilience, which subsequently reinforces SMEs' ability to withstand and recover from business disruptions. These findings demonstrate that entrepreneurial resilience is not solely determined by financial resources but is also shaped by organizational capabilities that enable SMEs to manage uncertainty and maintain financial sustainability within the framework of Islamic financial principles. This study contributes to the entrepreneurship and Islamic finance literature by integrating Resource-Based View, Dynamic Capability Theory, and Resilience Theory into a comprehensive sequential mediation model. The findings also provide practical implications for policymakers, Islamic financial institutions, and SME development agencies in designing capability-based programs to strengthen the long-term resilience of SMEs.]]>
Copyrights © 2026
