INFLUENCE OF FINANCIAL LITERACY AND WORKING CAPITAL MANAGEMENT ON FINANCIAL GROWTH OF SMALL BUSINESS ENTERPRISES IN KAKAMEGA COUNTY, KENYA

This study sought to investigate the influence of financial literacy and working capital management on financial growth of small business enterprises in Kakamega County, Kenya. The study used descriptive survey design. The study targeted 319 small business enterprises operating in a formalized organizational structure in Kakamega County, Kenya. The study used structured questionnaire as the main research. Statistical Package for Social Sciences (SPSS) version 24 was used in data analysis. From a total of 178 questionnaires, 108 questionnaires were returned when completely filled depicting a response rate of 60.7% which was good for generalizability of results to a wider population. From the values of unstandardized regression coefficients with standard errors in parenthesis, both independent variables financial literacy and working capital were significant predictors of financial growth of small business enterprises (dependent variable). The study concluded that financial literacy arising from education level and or financial management training of small business owners or managers can boost financial growth of small business enterprises because the financially literate owners or managers can understand and help mitigate financial needs of their small businesses. Further, effective working capital management can significantly influence financial growth of small business enterprises. The study recommended that first, small business owners or managers should embrace financial literacy training to assist them effect sound financial management measures in their business which will subsequently boost financial growth of their small business. Secondly, small business owners or managers should effectively management working capital of their business to avoid the business experiencing cash problems which definitely will have a bearing on financial growth of the business. Key Words: Financial Literacy, Working Capital, Financial Growth, Small Business Enterprises CITATION: Muneria, W. B., & Otinga, H. N. (2019). Influence of financial literacy and working capital management on financial growth of small business enterprises in Kakamega County, Kenya. The Strategic Journal of Business & Change Management, 6 (2), 1 – 17.