Abstract:
The owners' money management may impact on a micro or small enterprise's ability
to survive. This is only possible through planning and embracing saving. However,
the survival of these enterprises is still of concern especially those in Sub-Saharan
Africa (SSA), particularly in Uganda; where three out of five Micro and Small
Enterprises (MSEs) fail due to individual poor saving habits. The ability to handle
money successfully necessitates caution in spending decisions, allowing business
owners improve and sustain their businesses. The main objective of the study was to
determine the moderating role of self-control on the relationship between Social
Influence and Saving Behavior as mediated by Financial Literacy. Specific objectives
were to examine the effect of; Social Influence, Financial Literacy and Self-Control
on Saving Behavior of micro and small enterprise owner, to determine the effect of
Social Influence and Saving Behavior, the mediating effect of Financial Literacy on
the relationship between Social Influence and Saving Behavior, to examine the
moderating role of Self-Control; in the relationship between Financial Literacy and
Saving Behavior; Social Influence and Saving Behavior. The study additionally
looked at how self-control affected the strength of the indirect link between social
influence and business owner saving behavior via financial literacy. This research
was guided by the Social Cognitive Theory, Behavioral Life Cycle Hypothesis and
the Unified Theory of Behavior. The research adopted a positivism research paradigm
in addition to an explanatory research design. Multi-stage sampling technique was
utilized in collecting primary data from the target population of 46,270 and a
subsequent sample size of 430 MSE owners operating in Kampala, Uganda, using a
self-administered structured questionnaire. The study variables were all continuous,
and they were all measured by adapting previous study measures. Data was analyzed
by Pearson correlation coefficient, factor analysis, standard multiple and hierarchical
regression analyses. The study found that; Social Influence (β=.590, p=.000),
Financial Literacy (β =.244, p=.000) and Self-Control (β =.273, p =.000) positively
and significantly affects business owner saving Behavior. In addition, results show
that Social Influence directly influences Financial Literacy (β =.273, p =.000),
Financial Literacy partially mediates the relationship between Social Influence and
business owner saving Behavior (β =.065, CI=.033, .106), Self-Control moderates the
link between; Financial Literacy and owner saving Behavior (β = -.137, p=.000) and
Social Influence and owner saving Behavior (β =-.089, p=.009). Finally, Self-Control
was found to moderate the strength of the indirect relationship between Social
Influence and owner Saving Behavior via Financial Literacy, and the conditional
indirect effect is much stronger at lower levels of Self-Control (β =-.037, CI =-.067, -
.014).The study findings showed that, in addition to having social networks and being
financially literate, business owners ought to have some amount of self-control in
managing their finances, enabling them self-finance their enterprises and perhaps
grow their businesses and sustain them in a long run. It is on this basis that
government is recommended to implement policies aimed at encouraging savings of
Micro and Small Enterprises to support their self-financing through internally
generated funds as well as deepening the financial services sector through business
deposits, hence fostering the economic growth of the country. Future research could
be undertaken using a longitudinal or a qualitative evaluation using these study
variables.