Improving financial management among owners of Micro, Small, and Medium-Sized Enterprises (MSMES) in Nakawa division, Uganda.

Abstract

Uganda is considered to be a highly entrepreneurial country, but it also has a high number of MSMEs (Micro, Small, and Medium Enterprises) that perform poorly and often close within the first year. The purpose of this study was to explore the financial management skills of MSMEs’ owners in Nakawa division, Uganda, and propose strategies to improve their financial management practices. The objectives that guided this study are; to assess the financial management skills of MSMEs’ owners in Nakawa division, to identify the challenges faced by MSMEs’ owners in managing their finances effectively, To propose strategies to improve the financial management skills of MSMEs’ owners in Nakawa division. The study employed the Resource based View (RBV) (Barney, 2001), descriptive survey research design was used in this quantitative study. The study identified a concerning lack of record-keeping for both income and expenditure among a significant proportion of MSME owners. The study found out that most respondents find it hard to effectively organize and categorize income and expenses.The study recommends MSME owners should be encouraged to seek professional assistance when necessary, such as hiring qualified bookkeepers or financial advisors. Initiatives that facilitate networking and knowledge-sharing among MSME owners should be promoted. The study concludes that that enhancing financial management skills and practices is essential for the growth and sustainability of MSMEs in Nakawa division.