The key objectives of this study are to find the influence of financial knowledge on the performance of MSMEs in Central India, which includes the states of Madhya Pradesh and Chhattisgarh, India, and to assess the financial knowledge scores of entrepreneurs. Purposive and convenience sampling were used to collect the data from 459 MSMEs entrepreneurs. These enterprises work in service, manufacturing, and trading sectors, where data was collected with the help of a bilingual (English and Hindi) questionnaire based on 5-point Likert scale questions. Financial knowledge has five subdimensions: taxation and interest rate, financial markets, financial planning and budgeting, banking products and services, and government schemes. The MSME's performance has been measured through six indicators, which are profit, sales and revenue, total assets, number of employees, wages and salaries of employees and repayment of dues. After calculating the average value of both variables, simple linear regression analysis was used to test the hypothesis. Results showed a significant positive effect (F= 59.014, p < 0.001), with financial knowledge explaining 11.4% of performance variance (R² = 0.114; Beta = 0.338, p < 0.001), leading to the rejection of the null hypothesis. Financial knowledge scores (FK = 72.24) highlight a moderate to high level of financial awareness, where financial planning and budgeting (82.40) shows the highest scoring dimension, followed by taxation and interest rate (82.40), but a weak score in financial markets (52.30), highlighting the need for improvement. These findings underscore the role of financial knowledge as a key driver of MSME success. The study suggests a focused financial education programme that is especially intended to improve financial markets-related awareness and enhance entrepreneurial capacity.