Nexus Between Financial Inclusion and Economic Growth in Nigeria

Edoko Francis Neji; Associate Professor Adebisi Adesola

doi:10.56201/jafm.vol.12.no3.2026.pg471.482

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Nexus Between Financial Inclusion and Economic Growth in Nigeria

Edoko Francis Neji, ., And, Associate Professor Adebisi Adesola

Abstract

The study investigated the impact of financial inclusion on economic growth in Nigeria. It employed time series data obtained from the Central Bank of Nigeria statistical bulletin, World Development Indicators and National Bureau of Statistics. Financial inclusion was captured by calibrating a composite index comprising bank account ownership; percentage of adults with formal bank account, credit access; volume of credit to the private sector as a percentage of GDP, and Mobile money usage; percentage of adults using mobile money accounts. The index is constructed using Principal Component Analysis . Digital infrastructure was represented by composing the index of mobile phone penetration and internet penetration. The Autoregressive Distributed Lag estimation technique was used to establish the long run relationship among the variables. It was revealed that long run relationship exists among the variables in the estimated model. The results of the Error Correction Mechanism within the framework of the ARDL shows that financial inclusion has significant impact on economic growth in Nigeria. The study concludes that increased access to financial services such as banking, mobile money, and digital payment systems has been shown to facilitate broader economic activity. It was recommended that there is need to expand rural financial access, enhance digital infrastructure, improve governance and strengthen monetary policy framework to reduce inflation and to preserve purchasing power to support financial inclusion’s growth effects in the country.

Keywords

Financial InclusionEconomic growthECMNigeria.

References

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Nexus Between Financial Inclusion and Economic Growth in Nigeria

Abstract

Keywords

References

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