Effects of Financial Literacy on Financial Performance of Small & Medium Enterprises in Ongata Rongai -Kajiado County: A Case Study of Matatu Industry (original) (raw)
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Financial literacy has been identified as a one of the key competencies required for the establishing, management and thriving of SMEs. However, the exact effect they have on the financial performance of SMEs hasn't been fully established by the available literature thus the need for further research in this area. This study sought to establish the influence of financial literacy on the financial performance of SMEs in Ruiru sub county, Kiambu County. A descriptive survey design was adopted in conducting the study. The study population entailed the registered SMEs in Ruiru Sub County and who have undergone some financial literacy training by Equity bank through a programme known as financial knowledge for Africa (FiKA). A sample of 100 respondents was selected out of the total population of 334 respondents. The study used stratified sampling to get the sample of respondents. The data collected was analyzed using SPSS and the significance of the results tested using inferential s...
The desire by governments all over the world to improve the standard of living of their citizens has led to growth in the number of small and medium enterprises (SMEs). In Kenya, economic growth forms one of the pillars to attaining vision 2030 whose aim is to enhance the quality of living standards of Kenyans. However, the success of the SMEs is dependent upon a number of factors. A key ingredient in ensuring sound performance of SMEs is the level of financial literacy of the business people. The study aimed at assessing the influence of financial literacy on performance of small and medium enterprises. The objectives of the study were to evaluate the influence of budgeting skills, record keeping skills, credit management skills and tax compliance skills on performance of small and medium enterprises. The target population of the study was 3,916 consisting of the SMEs business community in Butere sub county, Kakamega County, Kenya. A sample of 390 was used in the study. The study employed a descriptive research design. Stratified random sampling was used in identifying the respondents. Data was collected using structured questionnaire. Regression equation was used to analyze the collected data. The study found out that financial literacy has a significant impact on the performance of SMEs. The study recommends that the government and non-governmental organizations should facilitate training of business people in the sector of SMEs so as to equip them with the necessary financial literacy skills in order to spur economic growth.
Effect of Financial Literacy and Performance SMEs. Evidence from Kenya
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Small Enterprises in Kenya face challenges that inhibit their growth and diminish their contribution to sustainable development. Consequently, few have transited from micro to medium scale. Although numerous financial education programmes are in place for MSEs development in Kenya limited growth persists, it's unclear which MSEs have been reached by the programmes and which key factors bring about growth. This research investigated the relationship between financial literacy and the growth of MSEs in Kenya. Descriptive cross sectional survey design was used. 306 MSEs were selected using stratified random sampling from a population of 1300 MSEs registered in Kakamega Central Sub County as of 2015. A questionnaire was used to collect primary data while document analysis was used for secondary data. Data was analyzed using percentages and frequencies using SPSS. Findings reveal that; although MSE managers had a fair knowledge of debt management literacy majority do not understand t...
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This study sought to evaluate the Effects of Financial Literacy on the financial Performance of small-scale Enterprises. Financial. The findings of this study would benefit the government and other stakeholders in knowing whether the gains of the financial literacy training can outweigh the costs of undertaking the training. This study adopted a descriptive survey design. The target population for this study is all the small-scale enterprises at the makola market which was 6034 traders. The target sample was 100 and since this is a descriptive study, Simple random sampling is more appropriate as it gives all items in a population an equal chance of being selected. Primary data was gathered by use of structured questionnaires which was both open and close-ended questions. Data gathered from the questionnaires was analyzed quantitatively using statistical package for social sciences (SPSS) computer software. SPSS generated both descriptive and inferential statistics. Descriptive statistics including the mean and standard deviation was used to capture the characteristics of the variables under study. Inferential statistics was used to analyze the relationship of the independent variable and the dependent variables. The study established that there was positive correlation between the dependent variable (financial performance) and the Independent Variables (financial literacy). Financial literacy also affected the savings and behavior of small-scale enterprise owners at makola market while savings behavior and attitude do not have effect on financial performance which means that the performance of traders at makola market is not determined by their savings behavior.
Strategic Journal of Business & Change Management, 2017
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FINANCIAL LITERACY: AN ESSENTIAL IN SMALL MEDIUM ENTREPRISES (SMEs) PERFORMANCE
Manajemen Bisnis, 2020
This study aims to examining the effect of financial literacy on the performance of Small and Medium Enterprises (SMEs) in Malang. This explanatory study was conducted in Sukun District, Malang City. The population was SMEs that located in Sukun District, Malang City which were selected using proportionate stratified random sampling with the total number of 220 samples. The study used descriptive quantitative design with primary data as the data source. The data was analyzed using Smart Partial Least Square (PLS) 3.3 Version with hypothesis tested using Bootstrap. The results of this study indicate that: 1) the financial literacy of the SMEs in Sukun District, Malang City was at a good literacy level which is Sufficient Literate; 2) the Small and Medium Enterprises in Sukun District has a good level of business performance; and Analysis of Smart PLS shows that financial literacy has a positive and significant effect on the performance of Small and Medium Enterprises in Sukun Distric...
The International Journal of Business & Management
In Kitale town, many SMEs are performing poorly due to poor financial management practices, yet they occupy a large part of the Trans-Nzoia County economy. If this situation is not addressed, their contribution to the economy will likely be affected. It was found that the growth rate of Kenyan small and medium-sized enterprises (SMEs) decreased from 5.4% in 2011 to 4.3% in 2013. Unemployment is a direct result of a drop in performance, and unemployment exacerbates social inequities and criminal activity. Because of this, this research examined the effect of financial management techniques on the performance of small and medium-sized firms (SMEs) in Kitale town, Trans-Nzoia County, Kenya. This study employed a descriptive research design. In this study, the target population comprised all the managers of retail shops/stalls, butcheries, hardware, and small hotels/cafeterias. Using Gay's criteria, the researcher selected a total of 45 respondents based in Kitale Town. The research...
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