Linking Financial Literacy, Social Capital, and Financial Inclusion Among Women Entrepreneurs in Manyu Division, Cameroon

Abstract

Financial inclusion has a wide range of positive effect on entrepreneurial activities, but studies indicate a lack of awareness about financial services in the large group of financially excluded individuals especially women in the economy. Most efforts to increase financial inclusion have emphasized financial literacy provided through formal training and education without due recognition that people’s financial behavior and practices may also be motivated by social interactions, belongingness and interpersonal relationships. To resolve this, this study has as specific objectives: to examine the influence of financial literacy on financial inclusion among women entrepreneurs in Manyu Division; to assess the effect of financial literacy on social capital among women entrepreneurs in Manyu Division; to examine the effect of social capital on financial inclusion among women entrepreneurs in Manyu Division and to examine the mediating effect of social capital in the relationship between financial literacy and financial inclusion among women entrepreneurs in Manyu Division. Methodologically, the result was estimated using Ordinary Least Squared with data collected among 466 women entrepreneurs in Manyu Division using well-structured questionnaire. The result shows that financial literacy is strongly corroborating with financial inclusion (38.28%) and social capital (22.31%). In the case of social capital, it was observed that it’s more of Mamfe Central (11.25%), Upper Banyang (1.57%) and Akwaya (6.96%) phenomenon. Social capital is equally observed to be strongly correlating with financial inclusion (29.18%) and it’s both secondary (28.4%) and higher education (44.57%) phenomenon. The mediation result shows that social capital is marginally mediating in the relationship between financial literacy and financial inclusion. The findings suggest that the decision makers should create more awareness via financial technical workshop on the relevance of financial literacy on financial inclusion and social capital in Manyu division in particular and Cameroon in general. This is a wise-step towards business performance and amelioration of economic well-being.