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The purpose of this study is to test for the mediating effect of debt literacy in the relationship between microcredit access and the survival of micro, small and medium enterprises (MSMEs) owned and operated by young women in rural sub-Saharan Africa post COVID-19.

This study uses a five-point Likert scale questionnaire to collect data from young women entrepreneurs with MSMEs located in rural northern Uganda. The Statistical Package for Social Sciences (SPSS) and SmartPLS with bootstrapping are used to test the magnitude and level of the mediation effect as recommended by Baron and Kenny (1986) and Hair et al. (2022).

The results reveal that debt literacy increases the impact of microcredit on the survival of young women entrepreneurs with MSMEs in rural sub-Saharan Africa post COVID-19 based on data collected from rural northern Uganda.

A questionnaire was used to collect data for this study. Future studies could collect data using interviews and the experimental research design to evaluate the effect of debt literacy over time.

This study provides valuable insights on the importance of debt literacy in microcredit access and the survival of MSMEs. The results of this study can be used to inform policy and guide practitioners on how to integrate debt literacy into the national educational and literacy curriculum.

This study brings into the limelight the important role of debt literacy in helping young women microentrepreneurs learn to be more cautious when taking on future debts and helping them become more resilient in the post COVID-19 pandemic situation. This topic of debt literacy is limited in the microcredit literature and the theory of microfinance in rural Uganda post COVID-19.

With reference to the global financial crisis and lessons learned, advocacy for distributing suitable financial products by financial intermediaries remain key if consumers, especially the illiterate in underdeveloped financial markets, are to be absorbed into the formal financial system. Financial intermediaries such as microfinance banks should provide suitable financial products, with full disclosure of information and customer protection relating to distribution of all financial products within the financial market to prevent financial vulnerability. The main purpose of this study is to establish the mediating role of financial product suitability in the relationship between access to microfinance products and survival of women micro-agribusinesses in rural Uganda.

SmartPLS with bootstrap based on 5,000 samples was used to test for the mediating role of financial product suitability in the relationship between access to microfinance products and survival of women micro-agribusinesses in rural Uganda.

The results revealed that financial product suitability improves access to microfinance products by 29 percentage points to promote survival of women micro-agribusinesses in rural Uganda. In reality, delivering suitable financial products that suit the economic condition of poor women micro-agribusiness borrowers, can allow them to use these products to generate income to meet timely repayment obligations and business demands.

The current study selected samples from only women micro-agribusinesses operating in rural Uganda, with a specific focus on the northern region. Thus, studies involving samples selected from other rural developing countries may be necessary in future. Additionally, while the findings are significant, the data were collected from only women microenterprises who are clients of microfinance banks. Future studies focusing on women microenterprises who are clients of other financial institutions may offer insightful comparative data.

The findings from this study offer strategies for managers of microfinance banks to invent and design financial products that suit the economic status and condition of different microcredit clients, especially the women micro-agribusinesses. This can help them to solve the problem of defaults in loan repayment and delinquency common while lending to the rural poor. In fact, microfinance banks should adopt a customized loan pricing model that can promote the operational sustainability and commercial viability of women micro-agribusinesses in the current situation of mission adrift.

The current study uses the suitability rule and economic theory to elucidate the importance of microfinance product suitability to increase microfinance inclusion of women micro-agribusinesses in rural areas in developing countries. The novelty in this paper is in combining the suitability rule and economic theory with microfinance theory to promote access to microcredit by the women micro-agribusinesses in rural Uganda under the situation of mission adrift. This is limited in the existing microfinance literature and theory, especially in developing countries like Uganda.