Bridging the Financial Knowledge Gap: How Financial Literacy Training Strategies Influence SME Success in Developing Nations

Abstract

The review examines the influence of financial literacy training strategies on Small and Medium-sized Enterprises (SMEs) success in developing nations, focusing on their contribution to tax compliance, financial management, and adherence to regulatory requirements. A systematic analysis of existing literature assesses the effectiveness of structured financial training initiatives, digital tax solutions, and policy measures designed to address compliance challenges. Research sources include academic databases such as Google Scholar, Scopus, and Web of Science, alongside reports from institutions like the World Bank, OECD, and national tax authorities, covering studies published between 2019 and 2024. Findings reveal that SMEs with stronger financial literacy experience greater financial stability, improved access to funding, and enhanced business sustainability. Complex tax frameworks, high compliance costs, and limited awareness continue to present significant obstacles to SME growth. The review suggests that incorporating financial literacy training into SME development programmes, streamlining tax policies, and adopting digital solutions can strengthen SME resilience and expansion in developing economies. These findings offer valuable insights for policymakers, financial institutions, and business development agencies seeking to create a more enabling regulatory and financial landscape for SMEs.