Abstract
The argument holds that visionary and dynamic small and medium enterprises (SMEs) tend to position growth at the centre of strategy. However, there has been a growing body of literature that has examined how financial literacy can support owner-managersof SMEs in making solid financial decisions that will enhance the growth of their businesses. In the present study, financial literacy and financial resource availability were modelled as different antecedents of SMEs growth. Nevertheless, the boundary condition for such models has received very little attention in the context of Ghana. Accordingly, in regard to resource-based view (RBV) logic, the current research examined the implications of contingency variable financial literacy (proficiency) on the relationship between financial resource availability and SMEs growth, particularly in the context of Ghana. The findings of the current research revealed that high financial literacy led to more positive effect of financial resource availability on SMEs growth.
Highlights
The growth of small and medium enterprises (SME) is a major concern to every economy considering their enormous contribution to socioeconomic development
According to Dollinger (1999) and Coleman (2007), financial resource availability is considered as the highest generic type of organizational means that can be changed into other forms of resources
The purpose of the present study is to investigate the performance implications of monetary proficiency on the association between financial resource availability and SME growth
Summary
The growth of small and medium enterprises (SME) is a major concern to every economy considering their enormous contribution to socioeconomic development. On a similar note, George (2005) argues that financial resource availability is a utilizable monetary asset that can be deployed or converted by a firm in achieving its target objectives. In regard to this matter, it becomes necessary for entrepreneurs to secure adequate monetary funding to ensure promising growth and performance of their enterprises. Lack of financial resources had been regarded as one of the major constraints that militate against the performance of SMEs, amongst developing economies (Beck et al, 2008; Demirguc-Kunt et al, 2013) This circumstance has created a critical challenge that prevents the entrepreneurs from meeting their expected business growth.
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