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Social Factors that Influence Loan Accessibility by Youth Entrepreneurs in Kenya: A Case of Youth Enterprise Development Fund in Gatundu South Constituency

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  • Stephen Ngige Ng’ang’a
  • Maurice M. Sakwa

Abstract

The objective for this study was to assess the social factors that influence loan accessibility by youth entrepreneurs in Kenya. Data for analysis was received from 112 youth entrepreneurs from Gatundu south constituency collected using questionnaires while using statistical analysis tool of SPSS to analyze data. Social factors such as background characteristics of youth entrepreneurs’ i.e. personal interest to entrepreneurship, entrepreneurship education and supportive family and friends were attributable in influencing youth entrepreneurs to access loan facilities. 93.9% of respondents indicated that they accessed youth fund because they had personal interest to be entrepreneurs, 64% were influenced by their family and friends who provided information on sources of finance, business ideas and moral support. Individual lending model was preferred by 52% of respondents to group lending model which was rated 86% as being ineffective. Group lending model on the other hand work effectively where therise cohesion and proper leadership. The study recommended review of policies on access to loans by youth entrepreneurs by government, policy makers and financial institutions with regards to social factors.

Suggested Citation

  • Stephen Ngige Ng’ang’a & Maurice M. Sakwa, 2015. "Social Factors that Influence Loan Accessibility by Youth Entrepreneurs in Kenya: A Case of Youth Enterprise Development Fund in Gatundu South Constituency," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 5(11), pages 230-248, November.
    • Handle: RePEc:hur:ijarbs:v:5:y:2015:i:11:p:230-248
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    References listed on IDEAS

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    1. repec:wbk:wbpubs:12254 is not listed on IDEAS
    2. World Bank, 2012. "The Little Data Book on Financial Inclusion 2012," World Bank Publications - Books, The World Bank Group, number 12253.
    3. Hossain, Mahabub, 1988. "Credit for alleviation of rural poverty: the Grameen Bank in Bangladesh," Research reports 65, International Food Policy Research Institute (IFPRI).
    4. repec:wbk:wbpubs:12252 is not listed on IDEAS
    5. World Bank, 2012. "The Little Data Book 2012," World Bank Publications - Books, The World Bank Group, number 12255.
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