Influence of Financial Intermediation on Sustainability of Youth Owned Enterprises in Western region, Kenya

Abstract

Purpose: Despite the challenges besetting youth-owned enterprises in accessing funds from sources such as YEDF, county youth funds, Uwezo Fund, and Women Enterprise Fund, the financial sustainability of the enterprise remains an issue. This research investigates the influence of financial intermediation on sustainable youth-owned enterprises in Western Kenya. Design/Methodology/Approach: The research adapted a pragmatic approach and descriptive survey design based on the framed financial intermediation theory. It focused on chairpersons or owners of 443 registered youth-owned enterprises within Kakamega, Vihiga, Busia, and Bungoma counties and used Taro Yamane’s proportional sampling formula to arrive at 210 respondents. Both structured and semi-structured questionnaires were used to collect primary data, while financial data was obtained from secondary data sheets. Data analysis was done using SPSS (version 23) with descriptive and inferential statistics, and tables were used to present the results. Findings: The results of linear regression analysis revealed that financial intermediation (β = 0. 629) had a positive and significant (P≤0.001) relationship with sustainability. Implications/Originality/Value: Findings reveal that financial intermediation exerts a considerable influence on the survival of start-ups and businesses owned and operated by youth. This exploration appropriates financing policies, partnerships, financial training, risk management, planning services, networking, and capacities for enhancing sustainability.

Keywords

• Financial Sustainability
• Financial Intermediation
• Youth-Owned Enterprises
• Financial Innovation