Do demographic characteristics influence the financial literacy of microentrepreneurs?

Abstract

Financial literacy is crucial to the growth and development of any enterprise. This study investigates the impact of microentrepreneurs’ demographic characteristics on financial literacy by breaking it down into three components: financial knowledge, financial behavior, and financial attitude. The study data were collected from 132 microentrepreneurs through a survey questionnaire using a snowball sampling technique. An ordinary least square regression was used to analyze how entrepreneurs’ demographic characteristics are related to financial knowledge, financial behavior, financial attitude, and financial literacy. The study revealed that being male, having higher education and more experience, and operating in urban areas have a significant impact on financial literacy and its three components. However, age was found to have no significant impact on financial literacy. This study will help in designing targeted strategies and specialized programs for entrepreneurs looking at the significant impact of their diverse characteristics on financial literacy.