The Effect of Financial Literacy on Ejo Heza Saving Scheme. A Case of Savers in Kicukiro District
DOI:
https://doi.org/10.53819/81018102t2303Abstract
The general objective of this research was to assess effect of financial literacy on Ejo Heza Saving Scheme in Rwanda. Despite excellent economic development in the recent decade, Rwanda remains a low-income country. Only 0.5 million salaried commercial and public sector workers, or less than 6% of Rwanda's total, are saving for retirement through the Rwanda Social Security Board (RSSB). This study had the following specific objectives: to establish the effect of budgeting literacy on savers of Ejo Heza saving scheme in Kicukiro District, examine the effect of debt management literacy on savers of Ejo Heza saving scheme in Kicukiro District and determine the effect of risk control literacy on savers of Ejo Heza saving scheme in Kicukiro District. For this study the population were 23,734 new savers of Ejo Heza Saving Scheme in Kicukiro. The sample size determined by the help of Solvin (1960) formula. Researcher select 393 sample size. In this study, researcher used cluster sampling. Primary and secondary data used. The researcher used descriptive and correlational research design. Data analyzed using SPSS version 23. The results of a regression analysis involving the predictors: Risk control literacy, Budgeting literacy, and Debt management literacy. The first hypothesis (H0a) stated that there is no significant effect of budgeting literacy on savers of Ejo Heza saving scheme in Kicukiro District. The findings indicate β1=0.132, p value of 0.017<0.05 give the researcher the right to reject the first null hypothesis of the study. The second hypothesis (H0b) stated that there is no significant effect of debt management literacy on savers of Ejo Heza saving scheme in Kicukiro District. The findings indicate β2=0.405, p value of 0.000<0.05 give the researcher the right to reject the second null hypothesis of the study. The third hypothesis (H0c) stated that there is no significant effect of risk control literacy on savers of Ejo Heza saving scheme in Kicukiro District. The findings indicate β3=0.241, p value of 0.002<0.05 give the researcher the right to reject the third null hypothesis of the study. Ejo Heza saving scheme should implement practical workshops or seminars specifically designed to educate members on creating and utilizing budgets effectively. Ejo Heza saving scheme should need to develop comprehensive modules that focus on financial planning techniques. Cover aspects like setting financial goals, investment strategies, and long-term planning.
Key words: Financial Literacy, Budgeting Literacy, Debt Management Literacy, Risk Control Literacy and Ejo Heza Saving Scheme
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