The impact of financial literacy on financial performance of SMEs in the Nelson Mandela Bay

In extant literature small and medium-zised enterprises (SMEs) are widely recognized for their contribution to economic development which has led to them being described as the backbone of national economies across the world. Although these are several potential benefits of a healthy SMEs sector, stimulating economic growth through job creation, increased market competition and innovation are among the more the commonly reported benefits. Despite this, SMEs owner-managers, particularly those operating in the South African Market, are faced with several obstacles that impede their success, thus contributing to the high and persistent failure rates among SMEs. When considering that SMEs are often comprised of the owner-manager as the principal decisionmaker, their ability to make decisions are crucial to the sustainability and long term success of their businesses. Against this background, the primary objective of this study is to determine the influence of the owner-managers on the financial performance of SMEs operating in the Nelson Mandela Bay. The failure of SMEs are often attributed to the prevalence of financial literacy among owner-managers. While broadly cited in extant literature, few studies have focused on financial literacy from the perspective of small business.Thesis (MA) -- Faculty of Business and Economic science, 202