Financial Management Skills and Financial Decision Practices Among Microfinance Members in The Municipality of Maitum, Sarangani

Abstract

This study examined the financial management skills and financial decision practices of microfinance members in Maitum, Sarangani, with the aim of developing a financial capability intervention. Utilizing a descriptive-correlational research design, the study assessed the relationship between the members' socio-demographic profiles and their financial management skills, specifically in fund management, spending management, and debt management. Additionally, it evaluated financial decision practices in income, spending, budgeting, savings, and investment. Findings revealed that the majority of microfinance members had low socio-economic status, with most falling below the poverty line and possessing only a high school education. Their financial management skills were generally rated as high, particularly in terms of fund and spending management, though challenges remained in systematic budgeting and distinguishing between essential and non-essential debt. Financial decision practices also scored high, with members demonstrating awareness in tracking income and expenses, though there were gaps in utilizing financial tools like budgeting applications and categorizing expenses effectively. Significant relationships were found between members' profiles and their financial management skills, as well as between financial management skills and financial decision practices. These findings highlighted the need for targeted financial education programs to enhance financial literacy, improve budgeting and savings behavior, and encourage informed decision-making. The study underscored the role of financial literacy in improving financial well-being, particularly among microfinance members who managed limited resources. The proposed financial education intervention aimed to strengthen members’ ability to handle financial matters effectively, ensuring financial stability and long-term economic sustainability.