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, theresearchers investigated influence of mobile money services on micro businessfinancial performance in Tanzania. Basing on the structural equation model(SEM) results, findings revealed that use of business to business (B2B) mobilemoney services significantly improved micro business sales and reduce businesscosts. Customer-to-Business (C2B) mobile money services were found to havesignificant positive influence on business sales only. Entrepreneurial orientation fully mediated the relationship between B2B mobile money services as well asmicro business sales and partially mediated the relationship between B2Bmobile money services and business costs. Entrepreneurial orientation fullymediated influence of C2B mobile money services on micro business sales.Hence, among others, this article recommends that there must be supportiveenvironment that may potentially promote business use of mobile money servicesby micro businesses.