Financial Inclusion and Microenterprise Sustainability: An Accounting Perspective on Rural Development Initiatives

Abstract

By increasing underprivileged populations' access to banking services, credit facilities, and digital financial systems, financial inclusion (FI) has grown to be a significant part of rural economic development. Rural microenterprises contribute significantly to employment generation and poverty reduction; however, inadequate financial literacy and weak accounting practices (AP) continue to hinder their long-term sustainability. The present study examines the influence of FI, accounting practices (AP), and economic literacy on the sustainability of rural microenterprises from an accounting perspective. Eighty rural microenterprise owners were given a structured questionnaire as part of a quantitative descriptive research design. Microsoft Excel was used to analyse primary data. Relationships between the study variables were examined using descriptive statistics, multiple regression analysis, independent sample t-test, chi-square test, and Pearson correlation. The results showed that FI greatly increases the sustainability of microenterprises by improving access to institutional support and financial services. Accounting practices such as budgeting, record keeping, and financial management positively influenced business stability and entrepreneurial performance. Additionally, there was a strong positive correlation found between financial literacy and sustainable business development. The sustainability of microenterprises is strongly predicted by FI, AP, and financial literacy, according to regression analysis. In order to promote sustainable entrepreneurial development, the study highlights the necessity of bolstering rural financial systems, accounting education, and digital FI initiatives.