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Are Small Biz Owners Financially Literate?

Having a tight grasp on your business’s finances would seem a requirement to run a successful small business. But new research shows just how little those business owners actually know when it comes to accounting – and how Intuit is hoping to change that.

A study released Wednesday (Nov. 13) has found a significant percentage of small business owners controlling their business’s finances despite openly admitting to not knowing too much about business accounting and loans.

Intuit and Decipher Market Research partnered up to examine the financial management behaviors of small business owners in the US. Their findings revealed that 40 percent of small business owners consider themselves to be financially illiterate, even though 81 percent handle their businesses’ finances themselves.

Now, Intuit wants to solve that knowledge gap.

The company unveiled the study’s findings along with a new Financial Literacy tool offered to small business owners aimed at boosting financial knowledge. As an interactive program, the Financial Literacy tool, Intuit says, encourages business owners to explore business accounting.

The program will also aggregate users’ results to compare financial literacy scores with others, Intuit says.

The Financial Literacy tool aims to tackle other concerning figures found by Intuit’s study, including revelations that 66 percent of small business owners wish they knew more about their finances, only 38 percent believe their employees understand their company’s finances, 69 percent have never taken out a business loan, and 28 percent of small businesses are in debt.

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New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.

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