Original Research

Exploring financial literacy education strategies based on small- and micro-enterprise business practices

Lorraine E. Derbyshire, Jacobus P. Fouché, Stuart McChlery
South African Journal of Business Management | Vol 54, No 1 | a3903 | DOI: https://doi.org/10.4102/sajbm.v54i1.3903 | © 2023 Lorraine E. Derbyshire, Jacobus P. Fouché, Stuart McChlery | This work is licensed under CC Attribution 4.0
Submitted: 20 January 2023 | Published: 09 November 2023

About the author(s)

Lorraine E. Derbyshire, School of Accounting Sciences, Faculty of Economic and Management Sciences, North-West University, Potchefstroom, South Africa
Jacobus P. Fouché, School of Accounting Sciences, Faculty of Economic and Management Sciences, North-West University, Potchefstroom, South Africa
Stuart McChlery, Department of Finance, Accounting, and Risk, Glasgow Caledonian University, Glasgow, United Kingdom


Purpose: This study explored the nature of business practices of small- and micro-enterprises within the South African context to propose recommendations for financial literacy education strategies.

Design/methodology/approach: The data collection technique used for this qualitative study included semi-structured in-depth interviews with a case study of 10 small- and micro-enterprise owners who collectively trade within five of the nine South African provinces.

Findings/results: Small- and micro-enterprises do not need to differ significantly because the respective business practice themes identified are relevant within both contexts. Both category enterprises make use of a cash basis system, generally have inventory management systems in place and do not have sophisticated financial planning practices. The micro-enterprises studied do not have business plans or accurate pricing strategies and cash management is a concern. The small-enterprise participants generally did not show interest in competitors and their enterprises had more sophisticated bookkeeping practices in place than micro-enterprises.

Practical implications: Financial literacy education strategies for the owners should focus on providing guidance on tax matters, significance of business plans and how to prepare them, debtors management strategies, inventory management strategies, and a basic bookkeeping system that evolves from the cash basis of accounting to the accrual basis of accounting. It should also aim to educate owners on the importance of financial planning and risk management.

Originality/value: This research provides an evidence-based description of the characteristics of South African small- and micro-enterprises, which could prove valuable in developing future owner financial literacy education programmes as well as other support strategies targeted at this audience.


business practices; financial literacy; financial literacy education; nature of small- and micro-enterprises; small- and micro-enterprise(s)

JEL Codes

M00: General; M10: General

Sustainable Development Goal

Goal 8: Decent work and economic growth


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