Title:
EFFECT OF SOCIAL ECONOMIC CHARACTERISTICS ON FINANCIAL LITERACY AND FINANCIAL MANAGEMENT OF SMALL AND MEDIUM ENTERPRISES

Authors:
Abas Kasim, Mahmud Ahmad, Indonesia

Abstract:

This study aims to reveal the relationship of socioeconomic characteristics to financial management, through the financial literacy of SMEs in East Flores Regency. Primary data were collected directly from a sample of 172 SME respondents using a questionnaire and interview technique. Data were analyzed using the Path Analysis model based on Multiple Linear Regression. The results showed that the level of education, age, business experience, and income level cumulatively had a significant effect on financial literacy, as well as on financial management. Partially, all socioeconomic characteristics variables significantly influence financial literacy and financial management. The socioeconomic characteristics of SMEs do directly influence financial management, as well as indirectly affect financial literacy. Financial literacy factors significantly influence financial management