According to Doan (2020), there is a significant relationship between business

performance and financing choices. This suggests that having adequate knowledge of a
business's financial aspects can result in beneficial outcomes for the firm. SMEs can improve
their performance and experience growth by making well-informed decisions on financial
options like loans, investments, and savings.

Zada and Yukun (2019) further emphasize the positive relationship between investment
and financing decisions and a company's performance and growth. This suggests that businesses
that effectively manage their investment and financing choices are more likely to experience
improved performance and sustained growth. Understanding the financial implications of these
decisions allows companies to allocate resources efficiently and capitalize on opportunities for
expansion.

Usama and Yusoff (2019) highlight the influence of financial knowledge on financing
decisions and its significant impact on the continuity of a business. When entrepreneurs possess
sound financial knowledge, they are better equipped to make informed decisions about
investment, loans, and savings. This knowledge enables them to mitigate risks, optimize their
financial resources, and ensure the long-term sustainability of their business operations.

References

Anshika, Singla, A., & Mallik, G. (2021). Determinants of financial literacy: Empirical evidence

from micro and small enterprises in India. Asia Pacific Management Review.

https://doi.org/10.1016/j.apmrv.2021.03.001

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