DU JOURNAL OF MANAGEMENT & SOCIAL SCIENCES

• Olateju Dolapo Aregbesola

  Bowen University

  Author

• Ibukunoluwa Esther Omoniyi

  Bowen University

  Author

• Sunday O Omojola

  Bowen University

  Author

• Olatunde Wright

  Bowen University

  Author

• Temiloluwa Oyeladun Akinsola

  Bowen University

  Author

Access to finance is widely recognised as a critical driver for entrepreneurial innovation and long-term sustainability. However, financial constraints remain a significant barrier for entrepreneurs, particularly in developing economies, stifling innovation and growth. This study examines the impact of financial constraints on entrepreneurial innovation and sustainability among SMEs in Lagos State, Nigeria. A survey design was adopted, and data were collected from a sample of 150 entrepreneurs selected randomly from an estimated 1,200,000 SMEs registered in Lagos State between 2018 and 2024 using structured questionnaires and semistructured interviews. Data were analysed using frequency distributions, percentages, Z-tests, and multiple regression models in order to determine the connection between financial issues, innovation, and sustainability activities. The results indicated that financial constraints negatively and significantly affect both the capacity for innovation and the sustainability prospects of businesses. The study concluded that adopting strategic responses to circumvent financial barriers can also enable the development of more sustainable business models. This study deepens our understanding of how SMEs in developing economies cope with financial constraints while also informing policy redesigns and support frameworks to stimulate innovation and sustainability. The study recommends strategic policy interventions to improve SME access to finance and foster an enabling environment for innovation-led entrepreneurial  growth.

1. Olateju Dolapo Aregbesola, Bowen University

   Accounting and Finance Programme, Bowen University, Iwo, Nigeria

2. Ibukunoluwa Esther Omoniyi, Bowen University

   ^{Accounting and Finance Programme, Bowen University, Iwo, Nigeria}

3. Sunday O Omojola, Bowen University

   Accounting and Finance Programme, Bowen University, Iwo, Nigeria

4. Olatunde Wright, Bowen University

   Accounting and Finance Programme, Bowen University, Iwo, Nigeria

5. Temiloluwa Oyeladun Akinsola, Bowen University

   Accounting and Finance Programme, Bowen University, Iwo, Nigeria