Management Competence, Financial Literacy and Financial Inclusion of Village Savings and Loans (Vslas) in Rural Arua District
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Date
2025-07-24
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Makerere University Business School
Abstract
The study aimed at establishing the relationship between management competence, financial literacy, and financial inclusion of members of Voluntary Savings Associations (VSLA) in Arua Rural District, . The study employed cross-sectional research design to gather both qualitative and quantitative data using interview guide and questionnaires that was self-administered respectively. There were 450 VSLA members in the Arua District that made up the research population. Using the sampling distribution table provided by Krejcie & Morgan (1970), a sample size of 207 VSLA members was determined. The study employed a linear regression model to ascertain the link between the variables and Pearson's correlation to ascertain the relationship between managerial competence, financial literacy, and financial inclusion. Quantitative data were analyzed using SPSS version 20.
The study's conclusions demonstrated a significant positive relationship between managerial abilities and financial inclusion. Ultimately, the research demonstrated that overall management competency and financial literacy predicted 24.1% (adjusted R2 = 0.241) of the variance in financial inclusion among VSLAs in Arua District and explained variance in financial inclusion. Additionally, the results showed a strong positive correlation between financial inclusion and financial literacy.
The study makes two recommendations: first, the Ugandan government should be more proactive in promoting financial inclusion and financial literacy among VSLAs, particularly in the Arua district; second, VSLA actors such as CBOs and Micro Finance Support Centers should pay attention to the financial literacy of the new VSLA members. The beneficiaries must be made more aware of the financial inclusion programs. A financial inclusion policy should be developed by VSLA management as well, with the goal of making sure that their services and goods are affordable, easily navigable, high-quality, and accessible to borrowers. For members to complete their financial obligations, the management of VSLAs must implement automated systems or online mobile services transactions 24 hours to promote accessibility and usage of VSLA services. Further research is encouraged in establishing other factors influencing financial inclusion other than Management Competence and Financial Literacy.
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This is a master's thesis.
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Citation
Endreonzi, B. (2025). Management Competence, Financial Literacy and Financial Inclusion of Village Savings and Loans (Vslas) in Rural Arua District. Makerere University Business School.