Assessment of the impacts of financial intermediaries in Administering the youth fund: a case study of equity bank, Narok.

Abstract

The YEDF was conceptualized by the government of Kenya (GOK) in 2006. It was officially launched in February 2007, with an aim of taming the high rate of youth unemployment. The fund targeted all types of entities owned by the youth namely the sole proprietor, companies, cooperatives and groups. The study sorts to determine the impacts of financial intermediaries’ involvement in the management of the Youth Enterprise Development Fund (YEDF). This study has brought out the role in enhancing outreach and also minimizing depletion of the fund by reducing loss through default. The study was carried out in Narok County where stratified random sampling of groups under the YEDF was done. Data collection will involve both secondary data from the YEDF and primary data through questionnaire administered to the group. Data analysis involves multiple regression analysis. The study found that the youth groups had a high loan portfolio and had existed for an average of 60 months. The youth groups were composed of both youths and older persons with some lacking youths though they received youth funds. Hence a need to correct this by a plan to graduate all the youths above 35 years of age out of access to youth fund to bank loans with a moderate interest above the youth fund interest but below the market for some duration to minimize shock. The youth groups also had balanced gender mix. However, some were composed of entirely either gender. The bank has an enhanced stability of the groups by creating a strong bond and collective individual responsibility by not only funding individual businesses but joint group projects like purchase of group land parcels and ensuring group attendance discipline. Youth fund empowered many youths within the groups sampled. The study established good linearity between cash cover/savings, average loan size and loan portfolio in arrears, and loan portfolio of group.