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Financial Literacy in Enhancing Risk Resilience Among Small and Medium Enterprises
Subject area: Management and Commerce · Area of research: Business Administration, Finance
Abstract
This study examines the role of financial literacy in enhancing risk resilience among small and medium enterprises (SMEs) in selected municipalities of Laguna, Philippines. A mixed-methods research design was employed, combining quantitative data from 150 SME owners through survey questionnaires and qualitative insights from interviews with five SME owners. The findings revealed that SMEs exhibited high levels of financial literacy, particularly in savings and budgeting, which significantly strengthened their ability to manage financial risks and operational uncertainties. Although investment practices were present, they were less emphasized due to resource limitations and varying risk preferences. Statistical analysis confirmed a significant relationship between financial literacy?particularly in savings, investment, and budgeting?and SMEs' resilience in navigating financial disruptions. Demographic factors such as educational attainment and business experience were found to influence both financial literacy and risk resilience positively. This study concludes that financial literacy is not only a managerial competency but also a critical survival mechanism for SMEs. The results highlight the need for targeted financial education programs and collaborative support systems to enhance the long-term stability and competitiveness of SMEs.
Keywords
Financial Literacy, Small and Medium Enterprises (Smes), Savings, Budgeting, Risk Resilience
References
[1] Maravilla, V. S., & Flores, G. (2025). Entrepreneurial Competency, Resilience, and Financial Literacy: Drivers of Sustainable Performance in SMEs for Societal Welfare. Journal of Sustainability, Society, and Eco-Welfare, 2(2).
[2] Masdupi, E., Firman, F., Rasyid, R., & Darni, M. O. (2024). Financial literacy and sustainability in SMEs: Do financial risk attitude, access to finance, and organizational risk-taking tolerance mediate? Asian Economic and Financial Review, 14(1), 43–58.
[3] Molosiwa, T., & Holland, J. (2025). The impact of financial literacy on the performance of Small and Medium-sized Enterprises (SMEs): A review of literature. International Journal of Research in Business and Social Science, 14(3), 320–332. https://doi.org/10.20525/ijrbs.v14i3.4157
How to cite this paper
@article{1712629,
author = {Hannah Berzon G. Salceda, Christian A. Gajo, Charlene Mae E. Perez, Ricky A. Amelin Jr., Khent Anthony B. Pasawa},
title = {Financial Literacy in Enhancing Risk Resilience Among Small and Medium Enterprises},
journal = {Iconic Research And Engineering Journals},
year = {2025},
volume = {9},
number = {6},
pages = {549-556},
issn = {2456-8880},
url = {https://www.irejournals.com/formatedpaper/1712629.pdf},
abstract = {This study examines the role of financial literacy in enhancing risk resilience among small and medium enterprises (SMEs) in selected municipalities of Laguna, Philippines. A mixed-methods research design was employed, combining quantitative data from 150 SME owners through survey questionnaires and qualitative insights from interviews with five SME owners. The findings revealed that SMEs exhibited high levels of financial literacy, particularly in savings and budgeting, which significantly strengthened their ability to manage financial risks and operational uncertainties. Although investment practices were present, they were less emphasized due to resource limitations and varying risk preferences. Statistical analysis confirmed a significant relationship between financial literacy?particularly in savings, investment, and budgeting?and SMEs' resilience in navigating financial disruptions. Demographic factors such as educational attainment and business experience were found to influence both financial literacy and risk resilience positively. This study concludes that financial literacy is not only a managerial competency but also a critical survival mechanism for SMEs. The results highlight the need for targeted financial education programs and collaborative support systems to enhance the long-term stability and competitiveness of SMEs.},
keywords = {Financial Literacy, Small and Medium Enterprises (Smes), Savings, Budgeting, Risk Resilience},
month = {December},
doi = {https://doi.org/10.64388/IREV9I6-1712629}
}