IIARD International Institute of Academic Research and Development

IIARD International Journal of Economics and Business Management (IJEBM )

E-ISSN 2489-0065
P-ISSN 2695-186X
VOL. 10 NO. 11 2024
DOI: 10.56201/ijebm.v10.no11.2024.pg90.101

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Effect of Financial Inclusion on Economic Growth in Nigeria

Prof. Aliyu IDRIS

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Abstract

The study evaluates the effect of financial inclusion on economic growth in Nigeria from 2000 to 2023. Specifically, it investigates the long-term relationship between automated teller machines (ATMs) and economic growth in Nigeria. It examines the influence of Deposit Money Bank branches on the country's economic growth. Real Gross Domestic Product (RGDP) was used as a proxy for economic growth. The number of ATMs, deposit money bank branches, and population growth rate were employed as explanatory variables. An ex post facto research design was adopted, with data from the Central Bank of Nigeria (CBN) Statistical Bulletin and the World Development Indicators (WDI) database. The Autoregressive Distributed Lag (ARDL) model was applied to analyse the relationship between the variables. The findings reveal that ATMs have a negative and insignificant effect on economic growth, whereas the availability of deposit money bank branches exerts a positive but insignificant impact. The study recommends that the Central Bank of Nigeria (CBN) improve ATM network efficiency by requiring banks to evaluate and upgrade their ATM infrastructure regularly. Additionally, the CBN should promote strategic branch establishment in rural areas to enhance financial inclusion.

keywords:

Automated Teller Machines, Deposit Money Bank Branches, Economic

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