African Journal of
Business Management

  • Abbreviation: Afr. J. Bus. Manage.
  • Language: English
  • ISSN: 1993-8233
  • DOI: 10.5897/AJBM
  • Start Year: 2007
  • Published Articles: 4036

Article in Press

The Impact of a Cashless Economy on the Performance of Micro, Small and Medium Enterprises in Zimbabwe

Mwero Trymore

  •  Received: 06 November 2018
  •  Accepted: 11 January 2019
The research intended to investigate the impact of cashless economy on the performance of micro, small and medium enterprises (MSMEs) in Zimbabwe. The closure and failure to survive of MSMEs in a cashless economy prompted the researchers to carry out this study. The objectives of the study were to determine the effects of cashless economy on performance of MSMEs and to identify the factors hindering the adoption of cashless solutions by MSMEs. Again, the researchers wished to develop strategies that can be used to sustain the survival of MSMEs in a cashless economy. A descriptive survey research design was adopted. The population comprised MSMEs in Harare from which owners, and/or senior employees were participating. An accessible population of 855 MSMEs was used, from which a sample of 272 was drawn using stratified simple random sampling technique. The sample represented 31.8% of the accessible population. The main data was collected from primary sources using questionnaires and interviews while secondary data was collected from journals, government reports, newspapers as well as MSMEs’ existing documents. Data was presented in tabular form, graphically as well as statistically. The findings of the study revealed that cashless economy has strong and significant negative financial and operational effects on performance of MSMEs in Zimbabwe. Thus, there exists negative correlation between cashless economy and MSMEs performance. This means that the combined effects of cashless economy are significant in expressing and explaining lost markets, shortages, inflation and multiple pricing in Zimbabwe MSMEs business sector. The study suggested that the Ministry of Small and Medium Enterprises and Cooperative Development (MoSME&CD) and the Reserve Bank of Zimbabwe (RBZ) should implement a cashless policy after carrying out awareness campaigns to lure the unbanked MSMEs into the banking system. This has the end effect of MSMEs adoption of cashless solutions. Furthermore, researchers proposed that commercial banks should cooperate with MSMEs to install Point of Sale (POS) machines and give the MSMEs a loosened payment plan for the machines. This will ease adoption of the devices by MSMEs. The researchers suggest that the study can be carried out in different geographical areas as this study covered Harare, Zimbabwe only.

Keywords: Cash, Cashless economy, Economy, Micro, small and medium enterprises (MSMEs).