Assessing the Effects of Financial Literacy on Entrepreneurs' Performance: A Case Study of Kitwe District, Zambia
Year: 2025
Type: article
Study design: Observational Study
Abstract: This study assessed the effects of financial literacy on the performance of entrepreneurs in Kitwe District, Zambia, focusing on profitability, employment generation, and business sustainability. A quantitative research design was employed, using structured questionnaires to collect data from 50 randomly sampled entrepreneurs. Data were analyzed using descriptive statistics, chi-square tests, t-tests, correlation, and regression analysis. The results reveal that financial literacy exerts a significant positive influence on entrepreneurial performance. Entrepreneurs who received financial training reported higher profits (Mean = 2.94) than their untrained counterparts (Mean = 2.39, p = 0.041). Regression analysis identified cost control understanding as the strongest predictor of profitability (β = 0.335, p = 0.018). Furthermore, financial literacy fostered structured employment growth, with 44% of entrepreneurs hiring at least one new employee and 60% maintaining formal wage budgets. However, long-term sustainability was hindered by poor access to external financing. The study concludes that financial literacy is a pivotal determinant of entrepreneurial success. It is recommended that stakeholders enhance targeted financial literacy programs and improve access to financing to foster sustainable entrepreneurial growth in Zambia.
Authors: Stanley Ngoma, Peter Silwimba
Language: English
Subfield: Accounting
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W7115067167
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