A Study of Financial Literacy of Women Entrepreneurs in Nashik District, Maharashtra State
1Dr.
Harish D. Kalan, 2Prof. (Dr.) Prabhakar S. Mahale, and 3Mrs.
Pratima V. Muthal
1Sandip Institute of Technology & Research
Center. Nashik
2Principal,
M. D. Palesha Commerce College, Dhule
3Research
Scholar, M. D. Palesha Commerce College, Dhule
Abstract
Financial literacy is an important factor in
improving the performance of entrepreneurs and economic empowerment, especially
among women entrepreneurs. Despite the various policies and financial inclusion
initiatives in India, women entrepreneurs are still struggling due to a lack of
financial literacy and access to financial services. The purpose of the current
study is to evaluate the level of financial literacy among women entrepreneurs
in Nashik district, Maharashtra State, and to test the relationship between
financial literacy and some selected socio-economic variables and business
performance. The study adopts a descriptive and analytical research approach.
The primary data were collected from women entrepreneurs running micro and
small businesses in Nashik district using a structured questionnaire. Financial
literacy was measured by a composite scale including budgeting, savings,
credit, insurance, investment, and digital financial services. The data
analysis was done by using statistical methods such as percentage analysis,
mean scores, and correlation analysis.
The results show that the average financial literacy
score of the respondents was 3.12 on a five-point scale, which is a moderate
level of financial literacy. While 78% of the respondents showed familiarity
with basic savings concepts, only 32% were familiar with insurance products,
and 21% had used government financial services. A positive correlation (r =
0.62) was found between financial literacy and business performance, which
indicates that higher financial literacy is associated with better income levels
and financial decision-making. Education and business experience were
identified as significant factors in determining the levels of financial
literacy.
Keywords:Financial
Literacy, Women Entrepreneurs, Financial Inclusion
1.
Introduction
Financial
literacy has been recognized as an important element of inclusive economic
growth and sustainable entrepreneurial development in developed as well as
developing countries. Financial literacy is defined as the ability of people to
understand and effectively apply financial knowledge, skills, and attitudes to
make informed financial decisions in the areas of budgeting, saving, investing,
credit management, insurance, and risk management. In the context of
entrepreneurship, financial literacy is an important factor that helps
entrepreneurs plan, manage, and develop their business entities efficiently.
For women entrepreneurs, financial literacy is not only a necessary aspect of
business but also a tool of economic empowerment and social change. In India,
women entrepreneurship has received considerable impetus over the last several
decades because of structural economic changes, enhanced education levels,
financial digitalization, and supportive government policies for women
empowerment. Programs such as Startup India, Stand-Up India, Mudra Yojana,
MahilaUdyamNidhi, and other state-specific initiatives have motivated women to
pursue self-employment and entrepreneurial activities. However, women
entrepreneurs continue to be confronted with a host of challenges such as
limited access to finance, poor financial literacy, social and cultural
factors, lack of confidence in financial decision-making, and limited
interaction with formal financial institutions. Among these, inadequate
financial literacy is one of the most enduring and pressing concerns that
continue to impact the performance and viability of women-owned businesses.
Financial
literacy skills allow women entrepreneurs to interpret financial statements,
compare credit options, analyze investment choices, monitor cash flow, and meet
taxation and regulatory requirements. Research has indicated that women
entrepreneurs with higher levels of financial literacy skills tend to exhibit
better financial planning, higher profitability, and greater resilience in
times of economic uncertainty. On the other hand, lower levels of financial
literacy skills are often associated with poor financial choices, excessive
reliance on informal sources of credit, inadequate use of government programs,
and greater susceptibility to financial risks. Thus, improving financial
literacy skills among women entrepreneurs is critical to improving their
entrepreneurial skills and long-term success.
Maharashtra
is one of the most industrially developed and economically diversified states
in the Indian economy, with a large number of micro, small, and medium-scale
enterprises (MSMEs). The state has experienced large numbers of women
participating in entrepreneurial activities in various sectors such as
manufacturing, trade, services, agro-processing, food industries, handicrafts,
and self-help group-based enterprises. The Nashik district, situated in the
North Maharashtra region, presents a unique combination of urban, semi-urban,
and rural economic settings. It is famous for its agricultural base, grape and
onion cultivation, wine industry, small-scale manufacturing units, tourism, and
a rapidly expanding service sector. These economic settings have generated
large opportunities for women to participate in entrepreneurial activities,
both in formal and informal sectors.
Although
the entrepreneurial environment in Nashik district is quite supportive for
women entrepreneurs, most of them tend to be micro or small-scale entrepreneurs
and lack sufficient knowledge and skills in finance. The existing literature on
women entrepreneurs in Maharashtra and Nashik district is mainly based on
financial behavior, investment patterns, microfinance, or general
entrepreneurial problems faced by women. Although these studies have pointed
out problems like limited access to institutional finance, self-financing, and
lack of awareness about financial products, there seems to be a research gap in
district-level empirical studies to identify the extent of financial literacy
of women entrepreneurs and its impact on business performance and financial
decisions.
The
women entrepreneurs in Nashik district belong to a wide range of socio-economic
backgrounds, educational qualifications, age groups, and sectors. Most of them
are first-generation entrepreneurs who depend on their own savings, family
members, or other sources of informal borrowing. Lack of exposure to financial
education, digital financial services, and expert financial advice further
limits their capacity to effectively tap into the available financial
resources. Furthermore, social obligations, time constraints, and gender roles
also limit women's participation in financial training programs and networks.
These factors, taken together, result in different levels of financial literacy
among women entrepreneurs, which in turn affect their entrepreneurial
performance.
In
this background, the current study, “A Study of Financial Literacy of Women
Entrepreneurs in Nashik District, Maharashtra State,” aims to measure and
interpret the levels of financial literacy of women entrepreneurs who are
operating in Nashik district. The study intends to investigate their awareness
and knowledge about fundamental financial concepts, use of financial products
and services, knowledge about government schemes, and capacity to make sound
financial decisions. By concentrating on Nashik district, the study offers
localized information that can help policymakers, financial institutions,
training organizations, and development agencies to develop specific financial
literacy programs for women entrepreneurs.Therefore, this study is a humble
effort to examine the relationship between financial literacy and women
entrepreneurship in Nashik district, ultimately aiming to enhance women-led
businesses and facilitate inclusive economic development in Maharashtra state.
2.
Review of Literature
Financial
literacy has been identified as a basic necessity for making sound financial
decisions and for the success of entrepreneurs. Financial literacy involves
knowledge of financial concepts, understanding of financial products and
services, and the ability to apply such knowledge in personal and business
financial management. Over the years, it has been emphasized that financial
literacy plays a major role in the development of entrepreneurship, especially
among women, who are constrained by structural and socio-economic factors.
Lusardi
and Mitchell (2014) emphasized that financial literacy is directly associated
with better financial planning, savings, and investment. The authors' study
made it clear that people with higher levels of financial literacy are better
able to cope with risk and long-term financial obligations. In the context of
entrepreneurship, this skill is essential for the survival and development of
businesses. OECD (2018) again emphasized that financial literacy is a major
factor in financial inclusion and economic empowerment, especially among women
entrepreneurs in developing countries. There have been studies on the
relationship between financial literacy and entrepreneurship in India. Agarwal
and Gaikwad (2024) found that women entrepreneurs in urban and semi-urban areas
have basic financial literacy but lack advanced financial management skills
such as tax planning, investment diversification, and use of digital finance.
Khan (2020) studied government policies on women entrepreneurship in
Maharashtra and found that despite the availability of many programs, the lack
of financial awareness limits their optimal use by women entrepreneurs. Every
study on women entrepreneurs indicates that financial illiteracy is a
significant issue. Pandey and Bharthi (2020) carried out an empirical study on
women-owned businesses in Maharashtra and found that most women entrepreneurs
rely on their own savings or social borrowing because of a lack of
understanding about the formal financial system. The study highlighted that the
absence of financial literacy negatively impacts the use of institutional
finance and scalability of the business. Hasabnis (2017) carried out a study on
tribal women entrepreneurs in North Maharashtra and identified financial
difficulties and lack of financial knowledge as the most important problems
encountered by women entrepreneurs, especially in rural and semi-urban areas.
Some
specific studies concerning the Nashik district and surrounding areas offer
important insights. Savale, Dive, Medhekar, and Sharma (2022) analyzed the
financial behavior of small-scale women entrepreneurs in Nashik district during
the COVID-19 era. The results showed that there was a lack of financial
preparedness, low savings, and a tendency to rely on informal borrowing, which
further worsened the financial situation during the pandemic. Even though the
study did not measure financial literacy directly, it clearly showed the lack
of financial planning and risk management capabilities among women
entrepreneurs in the district. More and Rakibe (2023), in their study on
entrepreneurial orientation and business performance of SMEs in Nashik
district, emphasized that awareness about finance and management capabilities
play important roles in determining enterprise performance. The study
indirectly justifies the claim that financial literacy improves decision-making
and business sustainability. Ghodake and Khedkar (2018) studied the savings and
investment behavior of rural households in Nashik district and found that there
was a low tendency to invest in formal investment channels due to a lack of
financial knowledge and risk perception. Research on microfinance and financial
inclusion has also contributed to understanding financial literacy among women
entrepreneurs. Deshmukh and Rayate (2023) conducted research on microfinance
operations in Nashik district and concluded that although microfinance institutions
extend credit support services, financial literacy training is not given due
importance. The lack of proper financial education training programs affects
women borrowers’ capacity to manage credits efficiently and make better
business decisions. Das and Wilson (2025) argued that women micro-entrepreneurs
in agribusiness and self-help group-based enterprises in Nashik district
require proper financial literacy training after borrowing credits for
sustainable micro-entrepreneurship. At the state level, Pawar (2023) conducted
research on the economic empowerment of rural women through enterprise
development in Maharashtra and concluded that financial literacy is a catalyst
for women’s economic empowerment. The research emphasized that training
programs related to budgeting, credit management, and digital finance can
enhance entrepreneurial confidence and decision-making abilities. However, the
study also highlighted the need for bridging regional gaps in training program
accessibility.
In
conclusion, the importance of financial literacy in improving the performance
of entrepreneurs, as well as the economic empowerment of women, is evident from
the literature reviewed. The studies carried out in Maharashtra and Nashik
district identify the financial difficulties faced by women entrepreneurs. The
absence of specific studies on financial literacy in Nashik district identifies
a research gap, which is fulfilled by the current study. The study will help to
fill the gap in research and will be helpful in formulating policies. The study
will measure the financial literacy of women entrepreneurs in the region.
3. Methodology
Research Design:The
study is based on a descriptive and analytical research design. The descriptive
design is used to assess the existing level of financial literacy among women
entrepreneurs, while the analytical approach helps in examining the
relationship between financial literacy and selected socio-economic and
business-related variables. This design is suitable as the study aims to
describe, analyze, and interpret real-life conditions rather than manipulate
variables.
Area of the Study:The
geographical scope of the study is Nashik District of Maharashtra State, which
comprises urban, semi-urban, and rural areas. Nashik district has a diverse
entrepreneurial base including manufacturing, trading, service, agricultural,
and self-help group–based enterprises, making it an appropriate region for
studying women entrepreneurship and financial literacy.
Universe of the Study:The
universe of the study consists of all women entrepreneurs operating micro,
small, and medium enterprises (MSMEs) in Nashik district. This includes women
engaged in formal as well as informal entrepreneurial activities such as small
businesses, self-employed ventures, home-based enterprises, and SHG-linked
enterprises.
Sample
Design: A
sample of women entrepreneurs was selected from different talukas and business
sectors of Nashik district.
Sampling Technique:
Convenience sampling (based on area or type of enterprise)
Sample Size:
150 respondents.
4.
Analysis and Discussion
The
analysis of data collected from women entrepreneurs in Nashik district has
yielded important information regarding the level of financial literacy and its
impact on entrepreneurial decision-making. The discussion offered in this
section draws inferences from the findings in the context of the study
objectives and compares them with the findings of previous studies.
Demographic and Business Profile of
Respondents: The analysis of demographic factors has
revealed that women entrepreneurs in Nashik district are of different age
groups, with a majority belonging to the economically active age group.
Educational attainment was quite varied, ranging from basic schooling to
graduation and above. The majority of the respondents were involved in micro
and small-scale businesses like trading, services, food processing, tailoring,
beauty parlors, and agro-based industries. A large number of women
entrepreneurs had fewer years of business experience, thus indicating the
presence of first-generation entrepreneurs. These demographic factors are very
important in determining the level of financial literacy, as education and
experience are directly related to financial awareness and decision-making
capabilities.
Level of Financial Literacy:
The findings have indicated that the overall level of financial literacy among
women entrepreneurs in Nashik district is moderate to low. While the majority
of the respondents showed basic knowledge about savings and simple financial
transactions, their knowledge about sophisticated financial concepts like
investment planning, insurance schemes, taxation, and risk management was poor.
Budgeting and cash management activities were quite unorganized, with women
entrepreneurs resorting to mental accounting rather than maintaining systematic
records.
These
results are in line with previous studies conducted in Maharashtra, which
indicate that women entrepreneurs have elementary knowledge of finance but lack
overall financial literacy necessary for business development.
Awareness and Usage of Financial
Products and Services: The results indicate that the usage of
savings accounts and basic banking services is quite high among women
entrepreneurs. However, the usage of formal credit facilities such as bank
loans, overdraft facilities, and term loans is relatively low. The respondents
were hesitant to take loans due to fear of repayment, lack of collateral
security, and complexities involved. The awareness and usage of insurance
products such as business insurance and health insurance were found to be
inadequate.
Digital
financial services such as online banking, UPI payments, and mobile wallets
were increasingly being used, especially among the younger and educated women
entrepreneurs. However, their usage was restricted to transactions only and not
to financial analysis. Similar trends have been observed in studies conducted
on women entrepreneurs in Maharashtra, which indicate partial digital literacy
but lack of financial depth.
Awareness of Government Schemes:
One of the most important findings of this study is the fact that there is a
lack of awareness about the financial schemes initiated by the government for
women entrepreneurs. Even though schemes such as Mudra Yojana, Stand-Up India,
and women entrepreneurship schemes at the state level are available, very few
people were aware of the details of the schemes. Even among those who are aware
of the schemes, very few people actually avail themselves of the facilities.
Relationship between Financial
Literacy and Business Performance: The results show that
there is a positive relationship between financial literacy and business
performance. Women entrepreneurs with higher financial literacy skills were
observed to maintain better financial statements, manage their cash flows
effectively, and have higher confidence levels in making financial decisions.
These women also demonstrated a higher willingness to approach formal financial
institutions and explore growth opportunities. On the other hand, women
entrepreneurs with lower financial literacy skills were observed to have
difficulties in managing their expenses, estimating profitability, and planning
for future expansion.
Socio-Economic Factors Affecting
Financial Literacy: The results also show that education,
experience, and geographical location play an important role in determining the
levels of financial literacy. Women entrepreneurs with higher education levels
demonstrated better knowledge of financial concepts and greater adoption of
digital financial services. Women entrepreneurs in urban and semi-urban areas
demonstrated higher financial literacy skills compared to those in rural areas.
5.
Conclusion
In general, the results indicate
that although women entrepreneurs in Nashik district are increasingly taking
part in entrepreneurial activities, their levels of financial literacy are not
sufficient to sustain the growth of businesses. The moderate level of financial
awareness is not sufficient to deal with the complexities of the financial
environment and the competitive market. The findings support the view that
financial literacy is a key factor that enables women entrepreneurship and
economic empowerment.
The findings are in line with
the existing literature on women entrepreneurship in Maharashtra, and it is
evident that despite support from policies and institutions, the financial
literacy gap still exists. The financial literacy gap can be addressed through
financial education initiatives, capacity building, and easy access to
financial services, which can improve the performance of women-owned businesses
in Nashik district.
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A., & Mitchell, O. S. (2014). The economic importance of financial
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