Unlocking sustainable competitive performance in agro-based small and medium enterprises in South Asian Association for Regional Cooperation countries

Abstract

Agro-based small and medium enterprises (SMEs) are currently receiving top priority among policymakers of the South Asian Association for Regional Cooperation (SAARC) nations due to their great contribution to employment and GDP growth. This study examines the impact of financial literacy on the sustainable competitive performance of agro-based SMEs, with a focus on the mediating role of access to digital finance and the moderating role of business experience. Using Partial Least Squares Structural Equation Modelling (PLS-SEM), we analysed data from 345 SME owner-managers. The results indicate that financial literacy positively affects sustainable competitive performance, with access to digital finance serving as a significant mediator. However, business experience does not moderate the relationship between financial literacy and access to digital finance. These findings suggest that improving financial literacy and enhancing digital finance access are critical for the sustainable development of agro-based SMEs in the SAARC region.