Financial Literacy on SMEs Growth in Nairobi City County

Abstract: This study examines the influence of financial literacy on the growth of Small and Medium Enterprises (SMEs) in Nairobi City County, where limited financial knowledge and constrained access to financial services continue to hinder business performance and sustainability. Adopting a cross-sectional explanatory design, primary data were collected from 384 SMEs using structured questionnaires and analyzed through descriptive, correlation, and multiple regression techniques. The findings reveal that financial literacy significantly and positively influences SME growth, with financial product knowledge emerging as the most influential predictor, followed by budgeting skills and debt and liability management. These results indicate that financially literate SMEs are better equipped to make informed decisions, efficiently allocate resources, and sustain long-term growth. The study concludes that financial literacy is a critical strategic capability for enhancing SME competitiveness. It recommends strengthening financial education programs, promoting access to tailored financial products, and supporting SME capacity-building initiatives, while future research should adopt longitudinal designs and advanced analytical models. Keywords: Budgeting Skills; Debt Management; Financial Literacy; Financial Product Knowledge; Nairobi City County; SME Growth. Title: Financial Literacy on SMEs Growth in Nairobi City County Author: Omiti Collins Odiwuor, Kariuki Grace Muthoni International Journal of Recent Research in Commerce Economics and Management (IJRRCEM) ISSN 2349-7807 Vol. 13, Issue 2, April 2026 - June 2026 Page No: 43-51 Paper Publications Website: www.paperpublications.org Published Date: 13-April-2026 DOI: https://doi.org/10.5281/zenodo.19556930 Paper Download Link (Source) https://www.paperpublications.org/upload/book/Financial%20Literacy%20on%20SMES%20Growth%20in%20Nairobi%20City%20County-13042026-5.pdf