Financial Literacy Research Articles

Financial literacy as an important aspect in the area of business sustainability: the case of Slovak Republic

The essence of literacy is currently understood on a broader level. Emphasis is placed on functional literacy, which also includes financial literacy. Its level significantly affects a person’s standard of living. In the contribution, we are devoted to the investigation of this issue and the possibilities of increasing the level of financial literacy in the Slovak Republic. We will use theoretical and empirical scientific methods. We work with analysis, synthesis, induction, and deduction. Subsequently, empirical scientific techniques that work with concrete data and precise methods to achieve results will be used. In addition to explanatory methods, interpretative methods will also be used. According to the level of financial literacy of respondents based on the interview method, hypotheses are established. An analysis of individual answers and an analysis of the impact of financial literacy on young people’s interest in entrepreneurship will be carried out. The findings led to the definition of practically oriented conclusions, with an emphasis on the assessment of the level of financial literacy. Attention is also paid to incentives for young entrepreneurs. All proposals written in this chapter are designed with the intention of improving the level of financial literacy in Slovakia.

Determinants of financial planning decisions for salaried individuals: Evidence from India

In the Indian context, financial planning for salaried individuals has gained increased importance due to economic fluctuations, rising living costs, and the need for robust retirement planning. Despite its importance, there is limited research on the specific factors that influence financial decision-making among salaried employees in India. Understanding these determinants is essential for developing effective strategies to enhance financial well-being among employees. This study explores the key factors influencing financial decision-making among employees, including financial goals, emergency savings, retirement planning, budgeting, financial confidence and literacy, financial stress, use of tax-saving instruments, income level, risk tolerance, and debt levels. A sample of 549 employees from diverse sectors in Uttar Pradesh participated in this research, highlighting the critical aspects of personal financial management that impact financial well-being. The study used a questionnaire-based survey to gather data on factors affecting financial decision-making. Descriptive statistics, correlation, and regression analyses were employed to identify significant predictors. The results reveal that financial literacy, access to resources, attitudes toward retirement planning, and cultural norms significantly influence financial decisions. Additionally, income level, job stability, and social support are crucial in shaping employees’ financial planning. The study recommends enhancing employees’ financial decision-making by offering financial education programs, budgeting tools, retirement planning assistance, debt management programs, tax planning workshops, financial counselling services, and employer match programs for retirement savings. These initiatives aim to boost financial literacy and confidence, enabling employees to make informed financial decisions and improve their financial well-being.

The power of financial literacy: paving a clear path for the influence of board diversity on intellectual capital disclosure

PurposeUtilizing a multi-theoretical framework, this study aims to investigate the impact of board gender and nationality diversity on the extent of intellectual capital disclosure. Additionally, it seeks to explore the moderating role of financial literacy among audit committee members on the aforementioned relationship.Design/methodology/approachTo empirically test the study’s framework, a panel dataset of listed firms on the Palestine Stock Exchange (PEX) spanning 12 years (2010–2022) was utilized. To address potential endogeneity issues and ensure robust findings, a battery of econometric estimators was employed, including ordinary least squares (OLS), one-step system generalized method of moments (GMM), lagged independent variables and a sub-index model.FindingsThe study findings make a significant contribution to existing intellectual capital literature. Specifically, the results reveal that the positive influence of board gender and nationality diversity on the extent of corporate intellectual capital disclosure is stronger when there is a high proportion of audit committee financial literacy. Additionally, the study distinguishes between overall index and sub-index analyses. Interestingly, the findings from the sub-index analysis, focusing on structural capital, relational capital and human capital, are somewhat similar to the results of the full index analysis.Originality/valueTo the best of the authors’ knowledge, this study represents the first empirical attempt to uncover the impact of financial literacy among audit committee members on the relationship between board diversity and intellectual capital disclosure.

Financial and Tax Literacy: A Child’s Early Exposure to Financial Concepts during the Educational Process

Aims: The viability of states today is largely based on the collection of tax revenues, which are considered as necessary for them to carry out their specific functions. Thus, the aim of this text is to discuss the development of citizens' tax culture, not as an isolated economic phenomenon but, as a phenomenon directly linked to their general financial literacy. Because it is the writer's belief that simply complying with the mandate to fulfill the tax obligation is not enough for the citizen to understand his contribution to the finances of his country, or, better, to appreciate this contribution in the context of understanding the ways in which the world moves financially. Methodology: It is a big question on how financially educated the modern man is and to what extent this financial education, his literacy or financial literacy, includes the concept of tax in its content to a sufficient extent to awaken consciences. In this text, the focus is on the exact age / educational stage at which this path to financial and tax literacy can begin, so that it can be integrated in a systematic way into the formal educational process. In order to draw conclusions about the appropriate stage for initiating financial awareness, the trends in the global financial literacy landscape were explored. This analysis aims to determine when it is considered appropriate to teach children financial concepts and how financial literacy is linked to making appropriate financial decisions and tax awareness at different age stages. An effort was carried out to evaluate the current financial and tax knowledge and behavior of Greeks. The research was exclusively bibliographic, i.e., a meta-analysis based on previous qualitative and quantitative studies. Results: Concerning the introduction of systematic financial and tax education for adolescents in schools, the studies accessed suggest that the age range of 12-14 marks a significant milestone for young people to begin delving into the more intricate concepts of the modern economy. Tax awareness among adolescents could arguably be attainable from around age 11 or 12, as they start demonstrating financial comprehension comparable to that of adults. Discussion: The findings of this research showed that the level of financial literacy in Greece depends on demographics, such as the geographical location and the gender of young people. Other factors are also important, but removing geographical and gender restrictions, combined with the provision of training programs already in the upper grades of Primary School, can improve financial awareness and develop the tax culture of citizens. This development requires the implementation of subjects in the curriculum, the training of the teachers so that they are able to teach children even 11 or 12 years old, the distinction of the concept of ethics from tax ethics and its teaching at an earlier age stage, and the drawing from international educational practices, i.e. leveraging successful financial literacy programs worldwide in order to obtain valuable insights for designing effective youth training initiatives.

Leveraging financial literacy into sustainable business performance: a mediated-moderated model

Purpose – The current study evaluates the linkage between financial literacy and the sustainable business performance model with access to finance and fintech adoption. Further, the moderating role of top management support in the linkage between financial literacy toward access to finance and fintech adoption was verified. Research methodology – This research was conducted in the SME sector in Indonesia. The sample frame were 261 SMEs and 783 respondents from three levels of management. Data was collected in the October-December 2023 period. Data were obtained utilizing Likert-scaled questionnaires and analyzed using SmartPLS. Findings – The results demonstrate that financial literacy is an instrumental driver of access to finance and fintech adoption that promotes sustainability performance. Subsequently, the study highlights the critical role of access to finance and fintech adoption as the mediator and top management support as moderator. Research limitations – The study is solely performed on the SME sector in one country; thus, the findings’ generalization is lacking. Practical implications – SME managers need to upgrade their financial literacy because financially knowledgeable managers are keenly informed of the costs, benefits, and risks related to funding schemes to encourage sustainable performance. Originality/Value – Empirical research that explores the implication of financial literacy on access to finance and fintech adoption in promoting sustainability performance is lacking, reported solely on manufacturing companies and banks. Meanwhile, the SME sector, especially in developing countries, is understudied. Consequently, the initial study leads the examination of financial literacy’s role in enhancing access to finance and fintech adoption to foster the sustainability performance of SMEs.

Women Fighting the Crisis: Antecedents of Women's Leadership Performance in Facing the Covid-19 Pandemic

Objective: This study aims to empirically investigate the interplay between financial literacy, entrepreneurial orientation, learning orientation, and the performance of food and beverage Micro, Small, and Medium Enterprises (MSMEs) in Bontang City, East Kalimantan Province. Method: The research, grounded in Resource-Based Theory (RBT), explores the mediation role of innovation ability in this relationship. The study encompasses 272 MSME owners as its population. Utilizing Structural Equation Modeling for data analysis. Research Findingsand Discussions: The findings show that financial literacy, entrepreneurial orientation, and learning orientation positively influence innovation capability and MSME performance. In addition, innovation capability emerges as an important mediator that bridges the impact of financial literacy, entrepreneurial orientation and learning orientation on MSME performance. The results of this study contribute to enriching the understanding of the Resource-Based Theory, highlighting that effective utilization of resources, such as financial literacy, entrepreneurial orientation, learning orientation, and innovation capability, can improve MSME performance. Research Implications: This study is a valuable reference for MSME owners in the food and beverage sector, emphasizing the importance of a proactive approach. Responding quickly to market opportunities, introducing new products to new markets, and developing a learning-oriented mindset all play an important role in driving innovation and ultimately improving MSME performance. Originality/Value: This research underscores the importance of strategic resource utilization for MSME success, in line with the principles of Resource-Based Theory. Owners of food and beverage MSMEs are encouraged to develop a proactive and learning-oriented attitude, encouraging innovation as a key driver to improve business performance.

Assessing Financial Literacy of Female Entrepreneurs in Informal Economy: Empirical Evidence from Micro Business in Malaysia

Financial management in business ensures that the goals of an organization are achieved. It has become a priority for every business to have good financial resources to ensure sustainability. However, many entrepreneurs are found to need help managing their finances well and are used to supporting a lavish lifestyle. As an outcome, they had to take a personal loan from a financial institution, and this personal loan is a big commitment because they must pay it back with a high loan rate. This situation puts an additional burden on entrepreneurs, which eventually becomes the cause of business failure. Employing a mixed method, this study's objectives are to evaluate the financial literacy of female entrepreneurs of micro-businesses in Malaysia and to determine the causes of financial illiteracy. This study involved 100 female entrepreneurs in the survey study and 20 female entrepreneurs of micro business in the interview study. The survey data were examined using descriptive and inferential statistics, and interview data were analyzed using thematic analysis. The survey findings have revealed that most female entrepreneurs have a low level of financial literacy, and financial literacy significantly influences business success. Interview data revealed that most informants still need to adopt the systematic accounting system, are unable to organize financial and personal accounts, do not have proper financial savings, and cannot calculate product costing and selling price. Therefore, this study will help female entrepreneurs manage their future financial practices.

Effects of financial literacy and attitude toward money on financial capability among SMEs in Malaysia

The study examines how financial literacy and attitudes towards money affect financial capability among SMEs in Malaysia. SMEs are crucial for global economic growth but frequently encounter specific obstacles that include financial instability. This study investigates the factors that influence the financial capability of SME owners, acknowledging its importance in promoting business expansion and adaptability. The study involves 231 SME owners and uses scales to assess financial literacy, attitudes towards money, and financial capability. Results show significant correlations among financial literacy’s dimension and financial capability. Financial literacy is a crucial factor in determining financial capability, underscoring the need to improve financial education for SME owners. One dimension of attitude towards money, which is price sensitivity, shows a significant relationship with financial capability. According to the study, SME owners should devote time and effort to financial education and training in order to improve their financial capability. This can help SMEs in decision-making, hence improving the financial performance of the business. The study provides important information for policymakers, business owners, and researchers, highlighting the necessity of specific actions to enhance financial knowledge and encourage beneficial financial practices among SMEs.

Pengaruh Literasi Keuangan Syariah terhadap Keputusan Nasabah dalam Memilih Cicilan Kendaraan Islami

This study aims to analyze the influence of Islamic financial literacy on customer decisions in choosing Islamic vehicle installments in Indonesia. Using a quantitative approach, a survey was conducted on several respondents in five major cities in Indonesia. The results showed that the level of Islamic financial literacy has a significant positive influence on customer preferences for choosing Islamic vehicle installments. Logistic regression analysis revealed that every one-point increase in the Islamic financial literacy score increases the odds of choosing Islamic vehicle installments by 4.9%. Demographic factors such as age, education, and income also have a significant influence. These findings highlight the importance of efforts to improve Islamic financial literacy as a strategy to encourage the adoption of Islamic financing products. Practical implications include the need for targeted education programs, improved product communication, and innovation in the development of competitive Islamic financing products.

Mlambe economic and relationship-strengthening intervention for alcohol use decreases violence and improves relationship quality in couples living with HIV in Malawi

IntroductionA syndemic of unhealthy alcohol use, intimate partner violence (IPV), and economic insecurity threatens to derail progress towards UNAIDS 95-95-95 targets in sub-Saharan Africa. We developed a combined economic and relationship-strengthening intervention called Mlambe to reduce unhealthy alcohol use and increase adherence to antiretroviral therapy for couples in Malawi. This study evaluates the additional impact of Mlambe on IPV and relationship dynamics. MethodsIn a pilot randomized controlled trial, 78 married couples (156 individuals) living with HIV and reporting unhealthy alcohol use based on the AUDIT-C (at least one partner) were recruited from HIV care clinics in Zomba, Malawi. The intervention arm (39 couples) received a 10-month program consisting of incentivized savings accounts with financial literacy education, relationship education, and couples counseling sessions to build relationship skills. The control arm (39 couples) received enhanced usual care (EUC) with brief alcohol counseling. We used linear mixed-effects models to assess the effects of Mlambe on relationship quality (e.g., constructive communication, unity, sexual satisfaction) and IPV (physical, sexual, and emotional) by including fixed effects for treatment arm and a random effect for dyad, and tested whether effects on IPV and relationship quality differed by gender. ResultsAt 10- and 15-month follow-up visits, couples in the Mlambe arm showed greater increases in couple communication, unity, sexual satisfaction, intimacy, and trust (Cohen's d ranged from 0.36 to 0.56; p < 0.05) as compared to EUC. Couples in the Mlambe arm also showed significant decreases in physical and emotional IPV (Cohen's d ranged from 0.33 to 0.49; p < 0.05) as compared to EUC. Subsequent moderation analyses indicated that women reported significantly greater improvements in relationship quality than men, except for sexual satisfaction (p < 0.05), and greater declines in physical IPV than men (p < 0.05). ConclusionsMlambe resulted in significant improvements in relationship quality and decreased IPV in couples, particularly for women who as a group reported lower relationship quality at baseline. Economic and relationship-strengthening interventions have potential to disrupt harmful syndemics of violence, substance use, and poverty among couples living with HIV. Clinical trial numberNCT#04906616.

The Mediating Role of Financial Self-Efficacy in the Relationship between Financial Inclusion, Literacy, and Investment Behavior among Banking Employees in Jakarta

The aim of this study is to identify and analyse the impact of Financial Inclusion, Financial Literacy on investment decisions through Financial Self-Efficacy on employees working in the banking sector of Jakarta region. This research uses a quantitative approach, the type of data in this study uses primary data obtained from the spread of the questionnaire. The population in this study is employees who work in the banking sector in the area of Jakarta, this study uses the Probability Sampling Technique that is Simple Random sampling so that the sample used is equal to 100 respondents. Data processing in this study uses SmartPLS. The results of this research show that the Financial Inclusion has an effect on Financial Self-Efficacy, Financial Literacy has no effect on Financial Self-Efficacy, Financial Self-Efficacy has no effect on Investment Decisions, Financial Inclusion has no effect on Investment Decisions, Financial Literacy has no effect on Investment Decisions, Financial Inclusion has no effect on Investment Decisions through Financial Self-Efficacy and Financial Literacy has no effect on Investment Decisions through Financial Self-Efficacy.

Moderation of Life Style on the Influence of Financial Literacy and Self-Control on the Saving Behavior of Millennial Employees in Denpasar City

This study aims to analyze the influence of financial literacy and self-control on the saving behavior of millennial employees, as well as the moderating role of lifestyle in the relationship. Financial literacy, which includes an individual’s understanding of basic financial concepts and money management, is hypothesized to play an important role in increasing saving behavior. Self-control, an individual’s ability to resist consumer impulses and make wise financial decisions, is also considered a key factor influencing the tendency to save. However, excessive consumption behavior as part of the millennial lifestyle can potentially hinder savings efforts even though they have adequate financial literacy and self-control. In this study, lifestyle is modeled as a moderating variable that can weaken or strengthen the influence of financial literacy and self-control on saving behavior. Data collection was conducted through a survey of millennial employees from various job sectors. Data analysis used the moderated regression method to test the interaction between financial literacy, self-control, and lifestyle in influencing saving behavior. The results showed that financial literacy and self-control had a significant positive effect on saving behavior. However, lifestyle acts as a negative moderator, where a consumptive lifestyle weakens the relationship between financial literacy and self-control with saving behavior. This finding provides practical implications for individuals and companies, especially in raising awareness of the importance of lifestyle control and financial literacy to encourage better saving behavior among millennial employees.

Factors Affecting Failure of Rural Entrepreneurs: Special Reference to Teldeniya Divisional Secretariat Area in Kandy District, Sri Lanka

This study aims at identifying factors affecting to failure of rural entrepreneurs and to examine moderate impact of financial literacy over the failure of rural entrepreneurs. This quantitative study investigates rural entrepreneurial failure in Sri Lanka's Teldeniya Divisional Secretarial Area. A sample of 187 entrepreneurs, who experienced failure, was surveyed, focusing on factors like risk aversion, perseverance, and financial literacy as a moderating influence. Objectives included identifying failure contributors and examining financial literacy's moderating impact on rural entrepreneurship. The study highlights key competencies and their relationship with failure, emphasizing financial literacy's role. It contributes valuable insights for governments, development organizations, and rural entrepreneurs to address failure causes and leverage financial literacy for improved outcomes. The findings hold practical applications for enhancing rural entrepreneurship in Teldeniya and similar areas.

FINANCIAL LITERACY, RISK TOLERANCE, RETURN, AND INTEREST IN STUDENT INVESTMENT DECISIONS

Investing in the capital market is growing rapidly in Indonesia, as evidenced by the increasing number of investors registered at PT Kustodian Sentral Efek Indonesia and most of them are young investors under 30 years old. The objective of this research is to examine how financial literacy, risk tolerance, return, and interest affect decision-making when it comes to investments. The participants involved in this study are students enrolled in the Bachelor of Accounting program at Udayana University's Faculty of Economics and Business from the graduating classes of 2020 and 2021. The sample was determined using the purposive sampling technique, a sample of 242 respondents was obtained. The data analysis technique uses multiple linear regression analysis. The results of the analysis prove that financial literacy, risk tolerance, return, and interest have a positive effect on students' decision to invest. The results of this study can provide empirical support in behavioral finance theory and theory of planned behavior which explain behaviors related to students' decisions to invest.

Assessment of Quality of Life and Work Motivation Among the Aging Workforce in Suphan Buri, Thailand

Demographic changes due to the reduced birth rate and aging in the population increase the proportion of older persons in the workforce. This article explores the determinants of and impacts on quality of life and motivation for work among the aging workforce of Suphan Buri, Thailand. Using a cross-sectional, mixed-methods approach from surveys and interviews with older persons, the quality of life of the older people in Suphan Buri was assessed as variable and dependent on their health and socioeconomic statuses. Personal characteristics of family and community, together with health and financial status, reflected quality of life and work motivation. A concept model connected the concepts of Relational, Income, Care, and Environmental (RICE) factors from analyzing themes to determine the quality of life and work motivation outcomes. Quality of life and work motivational factors for the aging workforce are also essential for the sustainability of agricultural and economic performance measures and production outcomes for Suphan Buri, Thailand. Efforts focusing on financial literacy, occupational policies, practices, and promoting family relationships, health status, and social engagements should be a strategy to prepare for aging and support a better quality of life and work experience.

Caring for Indebted Migrant Workers: Financial Literacy Training, Debt, and Filipino Migrant Workers in Dubai

This article explores the politics of care that undergird state and private initiatives that seek to assist overseas Filipino workers (OFWs) in Dubai. In addition to their precarious work conditions in the city, levels of debt are believed to be on the rise even among those categorized as professional, skilled, and semiskilled. These workers thus become the ideal subjects of financial literacy training programs aiming to turn them into “financially mature” individuals free from debt and capable of becoming future entrepreneurs if and when they return to the Philippines. This article highlights the ways in which financial literacy education, despite being framed as an act of care, can still work to obscure the specific political economic and structural conditions that produce and maintain debt among Filipino migrant workers in Dubai. Following Raghuram (2016), I “trouble care” to shed light on the “hidden geographies” of migrant worker debt and the challenges and complexities that need to be taken into account in caring for them. This article seeks to empirically and theoretically contribute to discussions on how debt can be viewed and used to constitute and shape future migrant solidarities.

Do Perceived Security and Financial Literacy Affect the Use of Financial Technology?

Do Perceived Security and Financial Literacy Affect the Use of Financial Technology?

On the drivers of financial literacy: the role of intergenerational mobility

On the drivers of financial literacy: the role of intergenerational mobility

FINANCIAL INCLUSION AND PERFORMANCE OF TOP 100 SMALL AND MEDIUM ENTERPRISES IN KENYA

Access to services such as credit, insurance, and savings enables SMEs to invest in growth, innovation, and operational efficiency. SMEs leveraging financial inclusion can enhance their revenue generation, cash flow management, and overall profitability. The study sought to find out what impact finance inclusion has had on the performance of Kenya's top 100 SMEs. This study was guided by finance intermediation theories, technology acceptance theory, TAM signal theory and pecking order theory. The study1was carried1out on the basis of a descriptive research design. The target population consisted of top 100 medium size enterprises in Kenya as shown in the annual survey carried out by KPMG and nation media group in the years 2020. Respondents ware financial officers from Kenya's top 100 mid-sized companies. Stratified sampling was used to interview respondents based on company category. Respondents were selected using a purposeful selection process. Data1was collected using structured questionnaire. A pilot survey was conducted with 10 respondents, but the final survey did not include these respondents. Validity of research instruments was measured using content validity. The study examined the effects of micro savings, micro credit, micro insurance, and digital banking on the performance of Kenya's top 100 SMEs, revealing that tailored financial products significantly enhance operational efficiency and growth. Findings indicated that micro savings improve financial stability, while flexible repayment options for micro credit support sustainable business practices. Additionally, awareness and customized solutions for micro insurance products were found to bolster risk management among SMEs. Digital banking was highlighted as a critical enabler of faster transactions and better cash flow management. The conclusions suggest that targeted financial services and educational initiatives are vital for empowering SMEs to optimize their performance. Recommendations include developing customized financial products, enhancing digital banking infrastructure, and providing financial literacy training to improve overall business resilience and sustainability.

Edukasi Menabung Sejak Dini Guna untuk Memanajemen Keuangan Dimasa Depan Bagi Anak Anak di Mesjid Taqwa Mandala

Education about saving from an early age is an important step in forming good financial management skills in children. Educational activities carried out at the Taqwa Mandala Mosque through Real Work Lectures (KKN), aim to increase children's understanding of the importance of saving and simple financial records. The research method used is a qualitative approach with counseling techniques, where children are introduced to the concept of saving using the media "Saving paper and piggy banks." This activity lasted for 15 days, with a focus on direct interaction to facilitate better understanding. The results of this activity show high enthusiasm among children and an increase in their knowledge about financial management. Support from PRM Mandala also plays an important role in the success of the program. Even though there are challenges, such as low interest in saving, this education has succeeded in instilling awareness of the importance of discipline in managing money. It is hoped that this activity can become a model for efforts to develop financial literacy in other communities, as well as have a positive impact in forming healthy financial habits for children.