DO ECONOMIC FACTORS AND FINANCIAL BEHAVIOUR INFLUENCE FINANCIAL LITERACY PERFORMANCE AMONG RURAL WOMEN IN UGANDA?

Abstract

Background: Lack of economic opportunities and good financial behaviour among women in rural areas are still far-reaching problems. Financial literacy performance has become more critical in supporting women empowerment especially in rural areas. Methodology: This study investigates how economic factors and financial behaviour influence financial literacy performance among rural women in Uganda: a case study of Luweero district. Using a multi-stage sampling strategy with a cross-sectional quantitative research design, a sample of 150 rural women subsistence farmers who are also operating small businesses was selected. Multiple linear regression models were used to predict on average the expected financial literacy performances among rural women. Results: Among the economic factors, on average women who were educated, own businesses and had ever received financial literacy training, and belonged to a village savings and loan association were expected to have financial literacy performance of 6.67 (pvalue=0.024,CI=0.89-12.45), 9.83 (p-value=0.031, CI=0.92-18.72), and 6.56 (p-value=0.05, CI= -0.01-13.13) more than those that were uneducated, had no business and had never received any form of financial literacy training, and belonged to no village savings and loan association respectively. Among the financial behaviour factors, on average women who were neither economical nor spending oriented, who had maintained minimal financial records, planned and implemented a regular savings programme were expected to have financial literacy performanceof 10.34 (p-value=0.037, CI=0.63-20.05),7.05(p-value=0.033, CI=0.57-13.53) and 13.04 (pvalue=0.000, CI=6.00-20.07) more than those who were very economical, never maintained any financial records, and did not plan and implement a regular savings programme respectively. Conclusions and recommendations: The findings demonstrate how economic and financial behaviour factors influence financial literacy performance among rural women in Uganda. Financial education; sensitization on the relevance of village savings and loan associations (VSLA); having a saving plan contribute to the economic and social empowerment of rural women.