Debt Financing, Debt Management Behaviour, and the Growth Sustainability of Small and Medium-sized Enterprises in Lira City

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dc.contributor.authorOkello, Apollo.
dc.date.accessioned2026-10-27T12:08:43Z
dc.date.available2026-10-27T12:08:43Z
dc.date.issued2026
dc.description.abstractGrowth sustainability of small and medium-sized enterprises depends on several interconnected factors; however, debt financing, debt management behaviour, and the effectiveness of these factors are influenced by the level of debt literacy among entrepreneurs. The purpose of this study was to examine the influence of debt financing and debt management behaviour on the growth sustainability of small and medium enterprises in Lira City, Uganda, while assessing the moderating role of debt literacy. The study was guided by trade-off theory, sustainable growth theory, the theory of planned behavior, and financial capability theory. A sequential explanatory mixed-methods research design was adopted, involving a survey of 311 small and medium enterprises followed by semi-structured interviews to provide deeper explanations of the quantitative findings. The results revealed that loan characteristics, including loan size, interest rates, and repayment practices, significantly influenced enterprise growth sustainability. Debt management practices, particularly financial self-efficacy, budgeting discipline, and responsible repayment behaviour, also contributed to improved sustainability outcomes. The results further showed that debt literacy strengthened the relationship between debt management behaviour and enterprise growth sustainability, while its interaction with debt financing was influenced by prevailing lending conditions. Qualitative findings indicated that entrepreneurs experience challenges related to high borrowing costs, limited loan adequacy, short repayment periods, collateral requirements, and unclear loan charges, which affect borrowing decisions. The study recommends the development of SME financing products aligned with business cash flows, expansion of debt literacy and financial capability programmes, and stronger collaboration between financial institutions and SME support organizations to promote responsible borrowing and sustainable enterprise growth.
dc.identifier.urihttp://hdl.handle.net/20.500.14270/1046
dc.language.isoen
dc.publisherGulu University
dc.subjectDebt Financing
dc.subjectDebt Management Behaviour
dc.subjectGrowth Sustainability
dc.subjectSmall and Medium-sized Enterprises
dc.subjectLira City
dc.titleDebt Financing, Debt Management Behaviour, and the Growth Sustainability of Small and Medium-sized Enterprises in Lira City
dc.typeThesis

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