Financial Literacy and Financial Performance of Small and Medium Sized Enterprises in Kakoba Ward Mbarara City, Uganda

Abstract

Uganda has been cited among developing countries which are populated with Small and Medium Enterprises (World Bank, 2018). These enterprises have been praised to be dominant players in instituting economic stability as well as playing key role in developing private sectors in Uganda. There has been Substantial financial support from both government and other development for example an African Guarantee fund worth US$ 30 million aiming at supporting African SME sector as well as fund support extended by the government through presidential initiatives to support Small and Medium Enterprises (MoFPED/UNPF, 2017). In addition to this financial support from the various development agencies, there has been also emergency of financial institutions for instance commercial banks and micro finance institutions in almost all parts of the country and these have also led to easy accessibility of funds by these enterprises easily (BOU,2013). However, Kasekende (2018) explained that majority of these SMEs fail to perform financial as evidenced by the high solvency rate as most of them fail to celebrate their second birthday due to misappropriation and mismanagement of their financial resources and all this is a true indicator of limited knowledge on how to manage financial matters of enterprises