Vol. 13(1), pp. 18-26. , 2024.

ISSN: 2384-6151

https://doi.org/10.14662/ijebm2025010

 

 

Full Length Research

 

Financial Literacy, Loan Management and Business Performance among Small Scale Business Owners in Nasarawa State.

 

1Daniel Mercy Ashedzi, 2Anyesha Amos Audu & 3Haliru Musa Hussaini

 

1,2&3Department of Business Administration and Management, School of Administration and Business Studies,Isa Mustapha Agwai I Polytechnic, Lafia- Nasarawa State.  

Corresponding author: anyeshaamos@yahoo.com  

 

 

Accepted 20 January 2025

Abstract

 

Small-scale business owners in developing economies, such as Nigeria, often face financial literacy challenges that significantly affect their ability to manage loans effectively. Nasarawa State, being a developing region, has unique but under-researched issues in this area. This study examines the relationship between financial literacy and loan management among small-scale business owners in Nasarawa State, highlighting the importance of financial education for business success. Research by Lusardi and Mitchell (2014) demonstrates that financial literacy is crucial for sound loan management, enabling better financial decisions, negotiation of favorable loan terms, and avoidance of predatory lending practices. Agarwal et al. (2015) further emphasize that low financial literacy contributes to poor debt management, often leading to business failure.Using a mixed-methods approach, this study combines quantitative and qualitative data collection. Stratified random sampling and selected small-scale business owners from diverse sectors, while purposive sampling identified key informants, such as financial advisors and loan officers. Data was collected through structured questionnaires and semi-structured interviews. Quantitative data is analyzed by the used using statistical methods, including descriptive statistics to assess correlations between financial literacy and loan management. Qualitative data was analyzed thematically to uncover challenges and best practices. The study focused on the specific context of Nasarawa State, this study fills a research gap and offered actionable recommendations for improving financial literacy and loan management practices, contributing to enhanced business sustainability and socioeconomic development (Creswell, 2014).

 

Keywords: Financial Literacy, Loan Management, Small-Scale Businesses.

 

Cite This Article As: Ashedzi, D.M., Amos, A.A., Hussaini, H.M (2025). Financial Literacy, Loan Management and Business Performance among Small Scale Business Owners in Nasarawa State. Inter. J. Econ. Bus. Manage. Vol. 13(1), pp. 18-26.