Date: 15-02-2023

Financial Literacy and Small and Medium Enterprises: Financial Literacy for Entrepreneurs

The second pillar of the project will explore Financial Literacy, a crucial competence for SMEs and future entrepreneurs, to acquire the skills, knowledge, and mindset to create, manage, and potentially close a business.


According to the European Commission[1], Small and Medium Enterprises (SMEs) constitute 99% of all businesses in the European Union. One hundred million people are employed in SMEs making up for more than half of the European Gross Domestic Product (GDP)[2].

Within this context, Aflatoun International and a consortium of organisations – Bantani Education, Danmar Computers, iED, ReadLab, and MateraHub – is supporting the creation of a European entrepreneurial e-learning platform helping SMEs to adapt to the current context. The project, an initiative of the European Union, aims to support existing and potential entrepreneurs, by promoting entrepreneurship education as well as encouraging specific groups with entrepreneurial potential.

The e-learning platform will work as a hub offering valuable and educational material, including online courses, masterclasses, podcasts, videos, etc., that will focus on four pillars: Entrepreneurship Competences (EntreComp), Financial Literacy, Sustainability Competences, and Digital Competences (DigiComp).

Aflatoun International, an NGO based in The Netherlands, offers high-quality Social and Financial Education to children and youth aged 3-24 around the world. Aflatoun has more than 20 years of experience in developing Social and Financial Education curricula, handbooks, courses and training, and works through a network of more than 300 partners in over 100 countries. Under, Aflatoun International will take the lead in developing the second pillar, Financial Literacy, in order to support learners to fully understand the framework in which enterprises are created and managed.

The Financial Literacy pillar will focus on three main thematic areas: Choice and Use of Financial Services, Financial and Business Management and Planning, Risk and Insurance. These themes were identified following a literature review and need assessment on the currently available financial literacy curricula, toolkits and training that are targeting youth, entrepreneurs, and more specifically women in both the formal and informal sector.

The educational material that will be developed and distributed on the e-platform will cover key topics within the three focus areas, including rights and responsibilities, pitch for investors, information about bankruptcy, liability, and EU regulations and procedures. It will also explore the financial planning processes, and will help new and future entrepreneurs embrace the opportunities and challenges that will lay on their path when managing finances and businesses. Finally, the course will offer information about risk-management, strategies and insurances.

The objective of the Financial Literacy pillar is to guide entrepreneurs through all the stages of an enterprise. At the end of the course and with the help of the different learning materials, learners will have acquired the competences and knowledge about creating an enterprise, transitioning to a formal phase and starting-up, making it grow by expanding and hiring employees, and finally obtaining the knowledge required to potentially close the enterprise, through liquidation, sale, succession, etc.

Considering the relevance of Small and Medium Enterprises within the European Union, it is essential that young people facing the prospect of creating and managing SMEs are well prepared to make accurate decisions for their future and the development of their businesses.