INTEGRATING INDIGENOUS FINANCIAL PRACTICES WITH MODERN ACCOUNTING SYSTEMS TO ENHANCE SUSTAINABILITY OF TRIBAL HANDICRAFT MICRO-ENTERPRISES IN UDHAM SINGH NAGAR, UTTARAKHAND

Abstract

This Tribal handicraft micro-enterprises constitute a vital component of rural livelihoods and cultural preservation in Uttarakhand, particularly within Udham Singh Nagar district, where indigenous communities continue to rely on traditional craftsmanship for income generation. Despite possessing rich artisanal knowledge and strong community-based economic systems, many of these enterprises face persistent sustainability challenges arising from weak financial management, limited access to formal credit, poor record-keeping, and low integration with modern markets. Indigenous financial practices—such as oral bookkeeping, trust-based credit systems, rotational savings, and kinship-driven financial accountability—continue to dominate these enterprises. While culturally embedded and socially efficient, these practices often lack scalability, transparency, and compatibility with formal accounting systems, thereby restricting growth and long-term viability.

This study aims to examine how the integration of indigenous financial practices with modern accounting systems can enhance the economic sustainability of tribal handicraft micro-enterprises in Udham Singh Nagar, Uttarakhand. Adopting a mixed-method research design, the study combines an extensive review of literature with primary empirical data collected from 182 tribal handicraft entrepreneurs through a structured questionnaire and selected qualitative insights from field observations. Quantitative data were analyzed using descriptive statistics, reliability testing, correlation analysis, and multiple regression techniques to assess the impact of financial integration on enterprise sustainability indicators such as profitability, income stability, access to credit, and continuity of operations.

The findings reveal that while indigenous financial practices foster trust, resilience, and community cohesion, their integration with basic modern accounting tools—such as cash books, cost records, inventory accounting, and digital payment tracking—significantly improves financial decision-making, transparency, and sustainability outcomes. The study contributes to existing literature by proposing a hybrid financial integration framework tailored to tribal micro-enterprises and offers actionable policy recommendations aligned with NEP 2020, MSME development strategies, and tribal entrepreneurship promotion schemes. The research holds practical relevance for policymakers, development agencies, academic institutions, and grassroots organizations working toward inclusive and culturally sensitive economic development.