Main Article Content
Abstract
This study explores how human resource (HR) practices influence business savings in small and medium enterprises (SMEs) through the mediation of financial literacy and savings motives. The primary objective is to determine the extent to which HR practices enhance business savings by improving employees' financial literacy and motivating savings behavior. Addressing the gap in integrating HR strategies with financial education, this research employs a quantitative approach using structural equation modeling (SEM) via Smart PLS 3. Data were collected from 241 SME employees through structured questionnaires. The results indicate that HR practices significantly boost business savings, primarily by enhancing financial literacy among employees. Although HR practices positively impact savings motives, these motives alone do not significantly mediate the relationship with business savings. The study concludes that incorporating financial literacy into HR practices is essential for fostering better financial decision-making and achieving substantial business savings. Consequently, SMEs should prioritize financial education within their HR strategies to improve their financial outcomes.
Keywords
Article Details
![Creative Commons License](http://i.creativecommons.org/l/by/4.0/88x31.png)
This work is licensed under a Creative Commons Attribution 4.0 International License.
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
- Adiyanto, Y., & Sunaryo, D. (2024). Analysis of QRIS Payment System Financial Literacy and Financial Management Performance on the Development of MSMEs Hamdan1. 5(2), 442–453. https://doi.org/https://doi.org/10.61194/ijjm.v5i2.1123
- Alameeri, K., Alshurideh, M., Al Kurdi, B., & Salloum, S. A. (2021). The Effect of Work Environment Happiness on Employee Leadership. In Advances in Intelligent Systems and Computing: Vol. 1261 AISC. Springer International Publishing. https://doi.org/10.1007/978-3-030-58669-0_60
- Alhamad, A., Alshurideh, M., Alomari, K., & Al, B. (2022). International Journal of Data and Network Science The effect of electronic human resources management on organizational health of telecommuni- cations companies in Jordan. 6, 429–438. https://doi.org/10.5267/j.ijdns.2021.12.011
- Alshebami, A. S., & Al Marri, S. H. (2022). The Impact of Financial Literacy on Entrepreneurial Intention: The Mediating Role of Saving Behavior. Frontiers in Psychology, 13(June), 1–10. https://doi.org/10.3389/fpsyg.2022.911605
- Angeles, I. T. (2023). The Moderating effect of Digital and Financial Literacy on the Digital Financial Services and Financial Behavior of MSMEs The Moderating effect of Digital and Financial Literacy on the Digital Fi- nancial Services and Financial Behavior of MSMEs. January. https://doi.org/10.55365/1923.x2022.20.57
- Azlan, A., Jamal, A., Kamal, W., Mohdrahimie, R., Roslemohidin, A. K., & Osman, Z. (2015). The Effects of Social Influence and Financial Literacy on Savings Behavior: A Study on Students of Higher Learning Institutions in Kota Kinabalu, Sabah. International Journal of Business and Social Science, 6(111), 110–119.
- Burchi, A., Włodarczyk, B., Szturo, M., & Martelli, D. (2021). The effects of financial literacy on sustainable entrepreneurship. Sustainability (Switzerland), 13(9), 1–21. https://doi.org/10.3390/su13095070
- Cowling, M., Brown, R., & Rocha, A. (2020). Did you save some cash for a rainy COVID-19 day? The crisis and SMEs. International Small Business Journal: Researching Entrepreneurship, 38(7), 593–604. https://doi.org/10.1177/0266242620945102
- D’Acunto, F., Rauter, T., Scheuch, C., & Weber, M. (2021). Perceived Precautionary Savings Motives: Evidence from Fintech. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3554858
- Despard, M. R., Friedline, T., & Martin-West, S. (2020). Why Do Households Lack Emergency Savings? The Role of Financial Capability. Journal of Family and Economic Issues, 41(3), 542–557. https://doi.org/10.1007/s10834-020-09679-8
- Doz, Y. (2019). Human Resource Management Review Fostering strategic agility : How individual executives and human resource practices contribute. Human Resource Management Review, xxxx, 100693. https://doi.org/10.1016/j.hrmr.2019.100693
- Dudchyk, O., Matvijchuk, I., Kovinia, M., Salnykova, T., & Tubolets, I. (2019). Financial literacy in Ukraine: From micro to macro level. Investment Management and Financial Innovations, 16(4), 240–253. https://doi.org/10.21511/imfi.16(4).2019.21
- Ertuğrul, H. M., & Gebeşoğlu, P. F. (2020). The effect of private pension scheme on savings: A case study for Turkey. Borsa Istanbul Review, 20(2), 172–177. https://doi.org/10.1016/j.bir.2019.12.001
- Farah, A., Purwanto, B., & Viana, E. D. (2023). The Influence of Financial Literacy and Financial Inclusion on Saving and Investment Behaviour for Millennial Generation in DKI Jakarta. TIJAB (The International Journal of Applied Business), 7(1), 73–86. https://doi.org/10.20473/tijab.v7.i1.2023.43436
- Fomum, T. A., & Opperman, P. (2023). performance of MSMEs in Eswatini. 50(11), 1551–1567. https://doi.org/10.1108/IJSE-10-2020-0689
- Hernita, H., Surya, B., Perwira, I., Abubakar, H., & Idris, M. (2021). Economic business sustainability and strengthening human resource capacity based on increasing the productivity of small and medium enterprises (SMES) in Makassar city, Indonesia. Sustainability (Switzerland), 13(6), 1–37. https://doi.org/10.3390/su13063177
- Kristanto, R. H., Hendry, R., & Impact, T. (2020). The Impact of Financial Literacy on Investment Decisions Between Saving and Credit: Studies on Sharia Bank Customers in the Special Region of Yogyakarta. 3(4), 1456–1463. https://doi.org/10.31014/aior.1992.03.04.291
- Malinda, M., Harianti, A., Tjandra, M., Margaretha, Y., & Sunjaya, A. (2021). Study of Financial Behaviors Micro Small Medium Enterprise in Bandung , Indonesia. April. https://doi.org/10.18178/ijtef.2021.12.1.688
- Mpaata, E., Koskei, N., & Saina, E. (2020). Financial literacy and saving behavior among micro and small enterprise owners in Kampala, Uganda : The moderating role of social influence. Journal of Economics, Finance and Accounting Studies (JEFAS), 2(1), 22–34. https://www.al-kindipublisher.com/index.php/jefas/article/view/10
- Ndaghu Julius Tumba, Vincent A. Onodugo, Ekom Etim Akpan, G. F. B. (2022). Financial literacy and business performance among female micro- entrepreneurs “ Financial literacy and business performance among female micro- entrepreneurs .” 19(1), 156–167. https://doi.org/10.21511/imfi.19(1).2022.12
- Pangestu, S., & Karnadi, E. B. (2020). The effects of financial literacy and materialism on the savings decision of generation Z Indonesians. Cogent Business and Management, 7(1). https://doi.org/10.1080/23311975.2020.1743618
- Peiris, T. U. I. (2021). Effect of Financial Literacy on Individual Savings Behavior; the Mediation Role of Intention to Saving. European Journal of Business and Management Research, 6(5), 94–99. https://doi.org/10.24018/ejbmr.2021.6.5.1064
- Rajan, B., Kaur, N., K. Athwal, H., Rahman, A., & P.S., V. (2021). Financial Literacy as a Tool for Stimulating the Investment Behaviour of Rural Women: An Empirical Assessment. Investment Strategies in Emerging New Trends in Finance, 1–15. https://doi.org/10.5772/intechopen.94532
- Riyadi, S., & Pritami, D. (2018). the Impact of Financial Literacy, Consumptive Behavior and M Banking Services on Savings Management. International Journal of Advanced Research, 6(10), 88–94. https://doi.org/10.21474/ijar01/7789
- Salas-vallina, A. (2020). The challenge of increasing employees ’ well-being and performance : How human resource management practices and engaging leadership work together toward reaching this goal. 2017, 1–15. https://doi.org/10.1002/hrm.22021
- Segovia-Vargas, M. J., Miranda-García, I. M., & Oquendo-Torres, F. A. (2023). Sustainable finance: The role of savings and credit cooperatives in Ecuador. Annals of Public and Cooperative Economics, 94(3), 951–980. https://doi.org/10.1111/apce.12428
- Shoaib, M., Abbas, Z., Yousaf, M., Zámečník, R., Ahmed, J., & Saqib, S. (2021). The role of GHRM practices towards organizational commitment: A mediation analysis of green human capital. Cogent Business and Management, 8(1). https://doi.org/10.1080/23311975.2020.1870798
- Stein, L. C. D., Yannelis, C., & Douglass, F. (2020). Financial Inclusion , Human Capital , and Wealth Accumulation : Evidence from the Freedman ’ s Savings Bank.
- Sulistiowati, S., Suwarsinah, H. K., & Simajuntak, M. (2023). The Factors Affecting Intention to Save at Indonesian Islamic Banks Using The Theory of Planned Behavior (TPB). Indonesian Journal of Business and Entrepreneurship, 9(1), 91–103. https://doi.org/10.17358/ijbe.9.1.91
- Titin, R., & Satono, S. (2022). Pengaruh Karakter Wirausaha Terhadap Keberhasilan Usaha Melalui Literasi Keuangan. Jurnal Ekonomi & Bisnis, 7(2), 1–14. https://doi.org/DOI: https://doi.org/10.30996/jeb17.v7i01.6544
- Yakob, S., Yakob, R., B.A.M., H.-S., & Rusli, R. Z. A. (2021). Financial Literacy and Financial Performance of Small and Medium-sized Enterprises. The South East Asian Journal of Management, 15(1), 72–96. https://doi.org/10.21002/seam.v15i1.13117
- Yuyanti Selan, Petrus E de Rozari, R. M. (2018). Pengaruh Literasi Keuangan terhadap Simpanan dan Pinjaman Anggota Koperasi Di Citra Akademika Kupang. 6(1), 21–37.