| Abstract |
The primary purpose of the study is to evaluate the financial literacy of Micro and Small Enterprise owners in Iligan City which focuses on financial knowledge and skills. Also, this study aims to identify the factors that could affect the quality and level of financial knowledge, skills and financial literacy as a whole. A total of 100 respondents with heterogeneous types of business were asked to answer 38 questions that were divided into three parts. Results showed that college education is the only significant factor and is positively related to financial knowledge while years in operation negatively affect the financial skills of the entrepreneurs. Moreover, this research showed that college education increases the likelihood of having a higher level of financial literacy relative to high school education. Based on the mean percentage ratings of financial knowledge, this study found out that most of the owners of these enterprises have low levels of financial knowledge in taxation, time value of money, financial institutions and investment securities. Also, the financial skills of the respondents displayed low mean percentage ratings in savings and record keeping yet planning and budgeting skills posted a fair mean percentage rating. Thus, results showed that in general, these entrepreneurs have low levels of total financial literacy based on the measurements used. Furthermore, the correlation between financial knowledge and skills is positive yet very low. The findings have practical relevance to MSMEs and policy makers to be able to determine the interventions necessary to help the MSME sector. It is recommended that future studies be made to substantiate the results of this study considering other municipalities and cities in the Philippines. |
Mindanao State
University - Iligan Institute of Technology