The Effect of Savings Literacy on the Financial Viability of Micro, Small and Medium Enterprises in Kitui County, Kenya.

Abstract

The objective of the study was to establish the effect of savings skills on the financial viability of Micro, Small and Medium Enterprises in Kitui County, Kenya. The study was underpinned by Resource Based View theory. A descriptive research design was employed. The researcher collected data using self-administered questionnaires and interviews. The target population comprised 1,800 MSMEs. Yamane formula was used to get a sample of 327. Self-administered questionnaires were issued to a sample of 327 Micro, Small and Medium Enterprises in Kitui County, Kenya. The data gathered were examined by use of both inferential and descriptive statistics. A multiple regression model was employed to demonstrate the link between the independent and dependent variables. The data generated were typed in and examined utilizing the Statistical Package for Social Sciences (SPSS) version 26, and information was generated and displayed through the use of tables, charts, and frequency distribution tables. This study found that Savings literacy (r=0.818, p=0.00) significantly influenced the financial viability of MSMEs in Kitui County, Kenya. The findings of this study would provide valuable insights for policymakers, financial institutions, and educational bodies to develop targeted financial literacy programs and interventions to enhance the financial health of Micro, Small and Medium Enterprises in Kitui County.