Financial Behavior and Entrepreneurial Success: An Empirical Analysis of Informal Markets in Zambia
DOI:
https://doi.org/10.59413/ajocs/v6.i.1.14Keywords:
Financial behavior, entrepreneurial success, informal sector, financial literacy, Zambia, financial inclusion, business sustainabilityAbstract
Small enterprises' success is much influenced by financial behavior, especially in the informal sector where financial knowledge and access to financial resources are few. Using data gathered from 350 traders in Lusaka's informal markets, this study examines the influence of financial behavior on entrepreneurial performance among Zambian informal traders. Using a mixed-methods approach, the study aggregates surveys, interviews, and regression analysis to assess how financial behavior relates to indices of corporate performance including profitability, growth, and sustainability. Results show a notable positive correlation (β = 0.62, p < 0.05) between disciplined financial behavior—that which includes saves, budgeting, and wise borrowing—and business success. To increase their business success and economic contributions, the study advises financial education programs, better access to financial institutions, and legislation encouraging financial capability growth among informal traders.
Downloads
References
Abor, J., & Quartey, P. (2010). Issues in SME development in Ghana and South Africa. International Research Journal of Finance and Economics, 39(6), 215–228.
Bryman, A. (2016). Social research methods (5th ed.). Oxford University Press.
Creswell, J. W., & Plano Clark, V. L. (2017). Designing and conducting mixed methods research (3rd ed.). Sage Publications.
Dzingirai, M., & Kapuya, T. (2018). Debt management and financial sustainability of informal enterprises in Zimbabwe. Journal of Small Business and Enterprise Development, 25(3), 432–447. https://doi.org/10.1108/JSBED-02-2017-0065
Fatoki, O. (2014). The causes of the failure of new small and medium enterprises in South Africa. Mediterranean Journal of Social Sciences, 5(20), 922–927. https://doi.org/10.5901/mjss.2014.v5n20p922
Field, A. (2017). Discovering statistics using IBM SPSS Statistics (5th ed.). Sage Publications.
Finscope Zambia. (2020). Financial Inclusion Survey Report. Lusaka: Bank of Zambia.
Kamau, C. G. (2024). Common Pitfalls in Monitoring and Evaluation with respect to project success in Africa. Available at SSRN 4891027.
Klapper, L., Lusardi, A., & Panos, G. (2020). Financial literacy and business performance: A global perspective. Journal of Economic Perspectives, 14(3), 67-89.
Lusardi, A., & Mitchell, O. S. (2014). *The economic importance of financial
Muzindutsi, P. F., & Sekhampu, T. J. (2017). Determinants of credit accessibility by small-scale traders in South Africa. Journal of Economics, 8(1), 1–12.
Nkwake, A. M., Mhonde, C., & Shambare, R. (2019). Asset investment and business growth among informal traders in Uganda. African Journal of Economic and Management Studies, 10(4), 534–549. https://doi.org/10.1108/AJEMS-02-2019-0063
Pretorius, M., & Botha, M. (2020). Financial literacy and business growth in informal economies: A South African case study. Journal of Developmental Entrepreneurship, 25(3), 2050017. https://doi.org/10.1142/S1084946720500174
Saunders, M., Lewis, P., & Thornhill, A. (2019). Research methods for business students (8th ed.). Pearson.
Smit, Y., & Watkins, J. A. (2012). A literature review of small and medium enterprises’ financial literacy practices in emerging economies. African Journal of Business Management, 6(21), 6324–6330. https://doi.org/10.5897/AJBM11.2709Research
Smit, Y., & Watkins, J. A. (2012). A literature review of small and medium enterprises’ financial literacy practices in emerging economies. African Journal of Business Management, 6(21), 6324–6330. https://doi.org/10.5897/AJBM11.2709
Downloads
Published
Issue
Section
License
Copyright (c) 2025 Kampamba Chibesa, Austin Mwange (Author)
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
