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Title ACCESS TO FINANCE AND SMEs GROWTH IN EMERGING ECONOIES: MODERATING ROLE OF FINANCIAL LITERACY (A COMPERATIVE STUDY OF MANUFACTURING AND SERVICE SECTOR)

Author(s) Mian Ghazanfar Ali

Abstract The objective of the study was to investigate the impact of financial literacy on the relationship between access to finance and SMEs growth in district Faisalabad. For this purpose, two hypothesis were formulated. First hypothesis was to check direct impact of access to finance on SMEs growth and second hypothesis was to assess the moderating effect of financial literacy on relationship between access to finance and growth of SMEs. The study followed a descriptive research method for obtaining necessary primary data to provide a clear understanding of the research objectives. The study involved samples drawn from SMEs of two sectors that were manufacturing and service. For this purpose primary data was gathered through the issuing of a set of structured questionnaires to a sample of 204 SMEs. The conceptual model consisted on three variables. First was access to finance as independent variable which was measured using three dimensions of accessibility, usage and quality and this measure was contained of seven items. Second was financial literacy as moderating variable, which was measured by four dimensions knowledge, skills, attitude and behavior. This measure was consisted of thirteen items. Third was growth of SMEs as dependent variable, which was measured by dimension of sale and assets. This measure was consisted of ten items. The data was collected from owners and top managers of SMEs. Convenient sampling was used to collect data. A descriptive statistics, Structural Equation Modeling, (SEM) was used to analyze the moderating effect of financial literacy on the relationship between access to finance and growth of SMEs. These analyses were carried out using Statistical Package for the Social Sciences (IBM SPSS), Smart PLS 3.0 version software. The finding of this study supports the hypothesis, which argued that financial literacy is important enhancer in relationship between access to finance and SME growth. The results of the study show positive and significant moderating effect of financial literacy in the relationship between access to finance and SME growth in district Faisalabad. In addition, access to finance also has a significant and positive impact on SMEs growth in district Faisalabad

Type Thesis/Dissertation MS

Faculty Management Sciences

Department Management Sciences

Language English

Publication Date 2019-05-03

Subject Finance

Publisher NUML

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