Foreign Literature

Small and Medium Enterprises

Small and medium businesses (SMEs) are non-affiliated, self-contained companies with

less than a certain number of employees. This number varies by country, with the European

Union's upper limit of 250 employees being the most common. However, some countries restrict

the number of workers to 200, while the United States uses 500. Small businesses typically have

less than 50 employees, while micro businesses have no more than ten, and in some cases no

more than five employees. SMEs may also be described by their financial assets; in the European

Union, SMEs must have an annual turnover of less than EUR 40 million and/or a balance-sheet

value of less than EUR 27 million.

The approximately 400 million SMEs that make up the world's economies are the

foundation of the global economy. They are the primary source of job development in the world,

accounting for over 95% of businesses and 60%-70 percent of jobs. In OECD economies, SMEs

account for a significant share of new job creation, and even more so in the EU, where they

account for nearly 99 percent of all companies, 85 percent of new job creation, and two-thirds of

total private sector jobs. Similarly, in the Global South, the production of SMEs is typically

linked to an increase in overall jobs.  They are also an integral part of global supply chains, both

as consumers and suppliers, and are considered critical to ensuring economic development,

creativity, job creation, and social inclusion, not least because of their strong relationships with

workers, the local community, and business partners.

Small and Medium Enterprises

Micro, small, and medium businesses (MSMEs) play a critical role in the development of

the Philippine economy. They contribute to poverty reduction by providing employment for the

country's rising workforce. They encourage economic growth in rural and remote areas. As

manufacturers and providers of support services, they are important partners of large

corporations. They operate as a cradle for new businesses and large companies. As a result, a

thriving and growing MSME sector is indicative of a thriving and growing economy. Despite

policies aimed at creating an enabling environment for MSME growth, the sector continues to

face a number of challenges that prevent it from reaching its full potential.

Profile of the Industry Any commercial operation or enterprise engaged in industry,

agribusiness, and/or services in the Philippines that has: (1) an asset size (less land) of up to

PhP100 million; and (2) an employment size of less than 200 employees is classified as an

MSME. Regardless of the level of business ownership, it is categorized as micro, small, or

medium based on these definitions (i.e., single proprietorship, cooperative, partnership or

corporation). There were 777,687 business enterprises in the Philippines as of 2010. MSMEs

accounted for 99.6% of the total, with 774,664 establishments, while large businesses accounted

for 0.4 percent, with 3,023 establishments. Micro businesses accounted for 91.6 percent

(709,899) of all MSMEs, while small and medium businesses made up 8% (61,979) and 0.4

percent (2,786), respectively.

for 49.7% of MSMEs, while manufacturing and hotels/restaurants account for 14.4% (111,366)

and 12.5 percent (96,989), respectively (Figure 1). MSMEs engaged in real estate, renting, and

business activities make up 6.1 percent (47,569) of all MSMEs, while those engaged in other

community, educational, and personal service activities make up 5.7 percent (44,209). Other

MSMEs (11.6%) are involved in health and social work (31,547), financial intermediation

(26,350), education (13,930), transportation, storage, and communications (9,010), agriculture,

hunting, and forestry (3,829), construction (2,292), power, coal, and water (1,307), fishing

(1,126), and mining and quarrying (1,126). (394).

In terms of work creation, MSMEs accounted for 3,532,935 jobs2 in 2010, accounting for

62.3 percent of all jobs generated by all forms of businesses. A total of 2,136,362 jobs were

created by large businesses. Micro businesses produced 1,729,100 (30.5 percent) employment,

while small and medium businesses created 1,417,672 (25 percent) and 386,163 (6.8%) jobs,

respectively, among MSMEs. MSME employment by sector typically follows the same pattern

as the number of establishments per industry, with MSMEs in the wholesale and retail trade

producing 1,237,917 jobs in 2010, followed by manufacturing with 617,634 jobs, and hotels and
restaurants with 479,668 jobs. The top five regions with the most MSME establishments and

MSME jobs, in terms of regional distribution, are: (1) National Capital Region (NCR): 209,223

establishments and 1,324,847 jobs; (2) Region 4-A (CALABARZON – Cavite, Laguna,

Batangas, Rizal, Quezon): 113,859 establishments and 459,564 jobs; (3) Region 3 (Central

Luzon): 79,019 establishments and 312,507 jobs; (4) Region 7 (Central Visayas): 45,322

establishments and Figure 2 depicts how the regional distribution of MSMEs corresponds to the

distribution of economic activity or income levels as measured by the gross regional domestic

product (GRDP).

Despite the fact that it represents a diverse range of industries and has the potential to

generate jobs, the Philippines' MSME sector has a low value added to the economy. MSMEs

contribute only 35.7 percent of value added in the country, according to the Department of Trade

and Industry, a lower percentage than in other Asian economies such as Indonesia (53.28

percent), Vietnam (39 percent), and Thailand (39 percent) (37.8 percent ).
Foreign Studies

Small and Medium Enterprises

Entrepreneurs are “coordinators of development and agents of change” (“creative

destruction”), according to Schumpeter (1950, 1961). Experts had previously discounted the

importance of "Schumpeterian Entrepreneurs" in the early stages of growth. However, at a later

stage of development, when economic growth is fueled by knowledge and competition, it

became critical. Economic growth will be largely dictated by “the rise of creativity, intellect, and

knowledge” as global economic forces, which will have a significant impact on managers and

investors as they navigate their businesses in a more competitive environment. Product and

marketing innovation capabilities have a substantial effect on SMEs' financial efficiency,

according to a report by Hazem et al. (2020), while process and organizational innovation

capabilities have a positive impact on SMEs' operational performance. Entrepreneurship is a

creative act that involves collecting all available resources with the aim of creating new wealth

(Lee & Kim, 2019).

Entrepreneurship can be described as "the act of being an entrepreneur" or "the owner or

manager of a business enterprise who attempts to make money through risk and initiative."

Sariwulan et al. (2020) investigate the direct and indirect effects of digital literacy, economic

literacy, and entrepreneurial skills on the success of SMEs in Bulak tourism industry clusters.

The study's key finding is that digital literacy has the greatest direct and indirect impact on the

success of SME entrepreneurs. The study's findings were used to help SME entrepreneurs

improve their efficiency through digital literacy, which included digital business partnerships,

online services, and networks. The results also add to the factors influencing SME entrepreneurs'
success in the digital age. The findings of the study revealed that digital literacy has the greatest

direct and indirect impact on the success of SME entrepreneurs, demonstrating the importance of

digital literacy in the development of business and market opportunities.

Using the TOE Model, Effendi et al. (2020) investigated the behavioral intention to

embrace social media in SMEs impacted by the COVID-19 crisis. According to the findings of

this report, SMEs affected by the COVID-19 crisis have a high understanding of social media

and a strong desire to use it to advertise their goods and communicate with customers. The

technical context, organizational context, environmental context, and social media knowledge all

have an impact on the decision to use social media. The results of this study indicate that

government assistance would be needed in the event of a COVID-19 pandemic. The government

must make resources available to SMEs whose operations have been harmed by the pandemic.

According to Kirzner (1973), an entrepreneur is someone who encourages "adjustments"

to exploit opportunities generated by changes, or in other words, "opportunity-grabbing-for-

profit essence of entrepreneurship where market' disequilibrium may be normal." Another theory

is the "behavioral theory," in which entrepreneurship is correlated with the behavior of an

individual who appears to be a "risk-taker" in an economic environment rife with risks and

uncertainty, and where a company's "survival rate" through a "dead valley journey" is relatively

low. The large number of small businesses in the informal sector is due to the high level of

instability in the environment. The number of micro and small businesses in the informal sector

is seen as a symptom of a risky and unpredictable economic climate. “Uncertainty around the

economy.” In this climate, growing entrepreneurs need government policies that reduce risk,

uncertainty, and transaction costs.

Company ownership was divided into three categories: sole proprietorship, partnership,

and others. Self-owned companies account for nearly two-thirds of all businesses, while

partnerships account for one-third (33 percent). In general, education is at an S1 level, and the

majority of companies are located in urban areas. Just two of the 21 UMKM are wholesalers,

indicating that these MSMEs are primarily engaged in retailing. In terms of growth,

approximately 75% recorded progress, with groups of entrepreneurs aged 20-40 years with a

bachelor's degree reporting the most progress, and there appears to be no substantial gap between

indigenous and non-indigenous entrepreneurs, self-owned companies and partnerships, where

capital is considered necessary for progress.

Debt Management

Debt management is an informal arrangement with unsecured creditors for the repayment

of loans over a set period of time, usually extending the time it takes to repay the debt. A

Statement of Affairs is given to creditors under debt management (SOA). A debt management

arrangement is a contract between a debtor and a creditor that sets out the terms of a pending

debt. This is a term used to describe a personal finance strategy for people who have a lot of

debt. Through the understanding and application of financial principles, financial literacy allows

a person or business owner to make educated and efficient decisions about money management.

The effects of financial literacy on the growth of small and medium enterprises has

attracted growing attention by various governments and researchers in the recent past. As a

result, the aim of this chapter is to include a summary of the current literature on the impact of

financial literacy on the growth of small and medium-sized businesses. It will concentrate on the
different types of financial literacy that are available to SMEs, the challenges that SMEs face in

accessing financial information, the solutions that can be used to resolve the challenges that

SMEs face in accessing financial information, and the benefits of financial literacy on SMEs'

development. Through the understanding and application of financial principles, financial

literacy allows a person or business owner to make educated and efficient decisions about money

management. In recent years, numerous governments and researchers have paid growing

attention to the impact of financial literacy on the growth of small and medium businesses.

As a result, the aim of this chapter is to include a summary of the current literature on the

impact of financial literacy on the growth of small and medium-sized businesses. It will

concentrate on the different types of financial literacy that are available to SMEs, the challenges

that SMEs face in accessing financial information, the solutions that can be used to resolve the

challenges that SMEs face in accessing financial information, and the benefits of financial

literacy on SMEs' development.

Financial Literacy

Financial literacy is characterized as a person's understanding of facts, concepts, values,

and technological resources that are necessary for financial decision-making (Garman and

Gappinger, 2012). Although there are many commonly accepted definitions of financial literacy,

they all mean the ability of individuals to access, understand, and analyze knowledge in order to

make choices that will better protect their financial future. After reviewing a number of papers

on the topic, Huston (2010) suggested that financial literacy must also include the application of

financial knowledge; the point being that a person cannot be considered financially literate

unless they can demonstrate their ability to apply financial knowledge. After careful
consideration of various points of view and the feasibility of using the term in analysis, the

OECD definition of financial literacy was chosen for the report, which describes it as "a

combination of understanding, information, ability, attitude, and action required to make sound

financial decisions and achieve individual financial wellbeing" (OECD, 2011).

Money fundamentals, budgeting, saving, and planning, borrowing and debt literacy,

financial goods, and recourse and self-help are the primary competencies of financial literacy.

The experience, skills, and understanding needed for the most basic day-to-day calculations are

referred to as money basics. Numeracy and money management skills are two examples.

Numeracy is the capacity to evaluate the appropriateness of expenditures for oneself. The

foundation for determining which financial products are cost-effective is numeracy. Furthermore,

numeracy has been found to have a significant impact on saving and even budgeting. Higher

numeracy has been linked to increased household income and sound financial choices, while low

numeracy has been linked to wasteful spending. With the deregulation of financial markets and

easier access to credit, the ready issue of credit cards, and the rapid growth in marketing financial

products, the need for financial literacy has grown in importance.

According to Mandell (2013), a greater focus on improving financial literacy will aid in

achieving a number of goals, including the public awareness and understanding of the financial

system, improving consumer security, and eliminating financial crime. Financial literacy,

according to Ambre (2012), begins at home, where children are taught how to manage money,

such as how to save and spend wisely. Most managers and specialists in the human resources

discipline, according to Rezak et al. (2017), should receive business acumen training. As

financial literacy and business acumen courses are often related, this will assist them in making

confident and knowledgeable recommendations. According to Green (2016), financial literacy

between employers and employees much simpler and efficient.

Effects of Covid-19 Pandemic

The disease's effects on society and economy can be seen in the global lockout, labor mobility

limits, travel bans, airline suspensions, and, most notably, the slowdown of the economy. From February

21 to March 24, 2020, the COVID-19 crisis went global, and the number of cases continues to rise at an

alarming rate. The COVID-19 outbreak is expected to have a significant impact on global GDP growth

(Word Economic, 2020). The global GDP is expected to be impacted by 2.3 percent to 4.8 percent as a

result of the global outbreak of COVID-19 (ADB,2020). Furthermore, it has been estimated that the latest

pandemic epidemic would result in a 5%–15% reduction in global foreign direct investment (UNCTAD,

2020b).

Furthermore, according to the UNCTAD survey, the world needs a $2.5 trillion aid package to

deal with the dam-age (UNCTAD, 2020a). As a result of these figures, the current financial recession is

expected to be worse than the 2008 crisis (UNCTAD, 2020a). Further, according to International Labor

Organization (ILO), almost 25million people across the globe could lose their jobs (loss of workers' in-

come of as much as USD 3.4 trillion) (ILO, 2020c) (ILO, 2020c). According to a more recent ILO survey,

lockdowns (full or partial) affect 81 percent (roughly 2.7 billion workers) of the global workforce

(ILO,2020b). “This is the worst economic crisis since World War II” (ILO,2020b). Estimates say the U.S.

will lose three million jobs by mid-summer in 2020, the pattern in Europe and other parts of the world

would besimilar (Siddiqui, 2020). (Siddiqui, 2020). COVID-19 has a ‘high' effect on the economic

production of accommodation and food services, real estate, whole-sale and retail trade, and motor

vehicle and motorcycle repair, according to the ILO, while it has a ‘low' impact on utilities, public

administration and protection, social work programs, human health, and education. 4 (The state of

Illinois) In developing countries, COVID-19 would have a more profound impact, making it far more
difficult for them to enact successful stimulus without facing foreign exchange constraints (UNCTAD,

2020a). The most vulnerable countries are those with poor health infrastructure, are heavily reliant on

trade and tourism, are heavily in debt, and depend on volatile capital flows (World Bank, 2020a).

Controllingthe COVID-19 outbreak will revive the economy, but the possibility of continuedfinancial

stress is very high even after 2020 (World Bank, 2020a) (World Bank, 2020a). Furthermore, it is expected

that the number of people living in poverty will rise by about 11 million (World Bank, 2020a). Although

the economic impact the of outbreak is continuing and is increasingly volatile, it is clear that the situation

in developed economies will get worse before it gets bet-ter (UNCTAD, 2020a) (UNCTAD, 2020a).

Income losses in developed countries are expected to reach $220 billion, according to the United Nations

Development Programme (UNDP) (UNDP, 2020b). Furthermore, the World Bank recently published a

study predicting that South Asia will experience its worst economic performance in 40 years, with half of

the countries entering a deep recession (World Bank, 2020b). This is particularly true in the case of

Pakistan.
Local Studies

Small and Medium Enterprises

Marketing is one of the major business activities in doing business. This activity

involves putting the product or service in the hands of potential customers. With this

importance, marketing can be considered Key strategy in attaining the business objectives.

Marketing has evolved over the past years. From traditional marketing, it has transformed into a

dynamic one. Today, the Internet and web technologies are used as tools to facilitate marketing

activities by business organizations. Nowadays, many business establishments have been using

the Internet and other electronic media in their marketing efforts giving a chance for

electronic marketing to grow in a very dynamic way (Salehi, Mirzaei, Aghaei, & Abyari,

2012).

With its sophisticated and dynamic features, the Internet could deliver the fastest

and most efficient ways of doing business thereby effortlessly gaining new customers and

product exposure. In the local setting, Samar offers a good number of businesses. These

businesses offer a variety of products that are potential for exports. As posted in the Province of

Samar Website (2014), there is a number of foremost industries in the province. These

include integrated mussel industry in Jiabong, coco oil industry in Calbayog, ‘tinapa’ industry

in Calbayog, native cheese processing in Gandara, abaca industry‘ ticog’ industry in Basey,

fishing industry, and copra industry. These industries could be good sources of products that

need extensive marketing.

According to a survey conducted by Bangko Sentral and Plipinas in 2017, 86 per cent of

Philippine households do not have bank accounts for a variety of reasons, including not having

enough money to deposit and lack of confidence in banks. According to the BSP's 2014

Consumer Finance Survey, only two out of every ten households have deposited their savings in

banks. This is in line with the results of the BSP's National Base Survey on Financial Inclusion,

which was conducted in 2014. According to the study, 32.7 percent of adults currently save

money in banks or cooperatives, while 43.2 percent currently do not. As a result, just 14.1% of

adults save in banks, according to the results (Guerrero, 2017). This situation, which affects the

majority of Filipinos, is concerning because it basically means that in the case of an emergency,

they will be unable to pay for it, potentially leading to an unforeseen debt. Not having personal

savings will limit your financial options.

Financial crises have a greater effect on families than on their affluent counterparts,

according to research, and their recovery from the financial crisis takes longer (Cramer and

Newville, 2009). Since no one knows what will happen in the future, funds should be set aside in

case of unexpected events or emergencies. Without savings, unexpected events can become

financial burdens. This is why having a savings account will help a person or a family become

financially stable. Money can also be saved to buy luxury goods that are out of reach on a

monthly basis. Developing a habit of saving money may serve as a vehicle to help a person

achieve his or her goals.

reduced the pressure of financially challenging situations (Loibl, et.al, 2011). In the Philippines,

banks are the main depository institution, led by multipurpose or credit cooperatives, paluwagan,

and savings and loan associations. 83.1 percent of deposit accounts were held together by

banking institutions. A bank account is a personal choice, not a requirement. There will be

occasions, though, when you will be unable to avoid the need to open a bank account. Many

Filipinos must come to terms with this fact in order to increase their passion for saving a portion

of their profits. Trading is one of the municipal government of San Antonio's sources of revenue.

Any business organization's primary goal is to make a profit, and the owner is the primary

beneficiary of such profits.

As a result, a company owner is one of the most attractive depositors to financial

institutions because they have a steady stream of money to deposit in their bank account and use

for reasons such as retirement and other financial goals in the future. However, most business

owners are currently not sure that they can retire because they do not have enough resources to

cover their day-to-day needs if they end their business operations. As a result, the aim of this

study's researcher is to classify the savings habits of micro, small, and medium-sized business

owners in San Antonio, Nueva Ecija. The study's aim is to determine if the owners are

effectively handling their financial capital while also maintaining the ability to save.
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Entrepreneurs in Manado, Indonesia. The Journal of Asian Finance, Economics, and

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