Financial Innovation, Entrepreneurial Orientation and Business Financial Performance: The Case of Micro Businesses in Tanzania

Abstract

Business use of mobile money services has significantly increased in Tanzania.
However, few of micro businesses perform well financially. Hence, the
researchers investigated influence of mobile money services on micro business
financial performance in Tanzania. Basing on the structural equation model
(SEM) results, findings revealed that use of business to business (B2B) mobile
money services significantly improved micro business sales and reduce business
costs. Customer-to-Business (C2B) mobile money services were found to have
significant positive influence on business sales only. Entrepreneurial orientation
fully mediated the relationship between B2B mobile money services as well as
micro business sales and partially mediated the relationship between B2B
mobile money services and business costs. Entrepreneurial orientation fully
mediated influence of C2B mobile money services on micro business sales.
Hence, among others, this article recommends that there must be supportive
environment that may potentially promote business use of mobile money services
by micro businesses.