Abstract. Credit risk of SMEs is an unresolved problem until today. One of the efforts to reduce credit risk is the implementation of corporate governance. However, it is not fully effective, as indicated by the research gap between corporate governance and credit risk. The purpose of this study is to develop a conceptual model of corporate governance innovation with blockchain technology to reduce credit risk. This research method is carried out by integrative literature review approach to assess, critique, and synthesize the literature on corporate governance, credit risk, and blockchain technology that enables to develop a conceptual model of corporate governance innovation using blockchain technology in SMEs. The results of this paper show that blockchain technology as a corporate governance innovation potentially can reduce credit risk of SMEs. Thus, SMEs can compete, grow and sustain in the long term. This conceptual paper needs to be tested empirically on SMEs that have loans and use digital in their business transactions.

Keywords: Corporate governance innovation · Credit risk · Blockchain technology