Financial Inclusion and Growth of the Last Mile Entrepreneurs in Makueni County, Kenya
Abstract
This study examined the influence of financial inclusion on the growth of last-mile entrepreneurs in Makueni County, Kenya, amid persistent challenges in business financing and sales performance. Reports indicate that over 70% of last-mile entrepreneurs failed to reach their second anniversary, while more than 56% experienced declining sales during the 2019, 2020, and 2021 financial years, with average declines of 21%, 34%, and 41%, respectively. The study assessed the effects of access to formal financial services, financial literacy, financial credit products, and financial technology on entrepreneurial growth. The target population comprised 1,923 entrepreneurs operating in agriculture, retail, service, and manufacturing sectors in major towns of Makueni County. A sample of 331 respondents participated, with data collected using a structured questionnaire whose validity and reliability were established. Quantitative data were analyzed using statistical techniques, while qualitative information was subjected to thematic analysis. Ethical considerations included informed consent, voluntary participation, and participants’ right to withdraw. Multiple regression analysis revealed an exceptionally strong model fit (R² = 0.997), indicating that the four financial inclusion dimensions jointly explained 99.7% of the variation in entrepreneurial growth. All predictors had positive and statistically significant effects (p = 0.000). Financial literacy had the strongest influence (β = 0.457), followed by financial credit products (β = 0.338), access to financial services (β = 0.143), and financial technology adoption (β = 0.069). The study concludes that strengthening financial knowledge, access, credit availability, and fintech adoption can enhance entrepreneurial growth and business sustainability. It recommends expanding inclusive financial services, strengthening financial literacy initiatives, developing flexible credit products, and investing in financial technology infrastructure and training initiatives.
Keywords: Financial inclusion; Financial literacy; Financial services; Financial credit; Financial technology; Entrepreneurial growth; Last-mile entrepreneurs
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