Financial Literacy and Entrepreneurial Decision-Making Among Informal Traders in Zambia

Kampamba  Chibesa; Austin  Mwange

doi:10.59413/eafj/v3.i2.11

Authors

Kampamba Chibesa Institute of Distance Education, The University of Zambia Author
Austin Mwange Graduate School of Business, Lusaka, Zambia Author https://orcid.org/0000-0001-8568-3063

DOI:

https://doi.org/10.59413/eafj/v3.i2.11

Keywords:

Financial literacy, informal traders, financial education, Zambia

Abstract

Financial literacy is crucial in influencing entrepreneurial decision-making, especially for informal traders in Zambia, who work within a dynamic yet financially limited environment. This research examines how financial literacy affects the decision-making processes of informal traders in Lusaka, Zambia. A mixed-methods approach was used, gathering data from 350 informal traders through structured surveys and qualitative interviews. Results indicate that higher levels of financial literacy are associated with better decision-making in areas such as business planning, investment selections, and financial management. Regression analysis findings show that financial literacy is a significant predictor of entrepreneurial decision-making (β = 0.54, p < 0.01). The study highlights the importance of enhanced financial education initiatives to promote business sustainability and economic development among informal traders.

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