Financial Inclusion and Macroeconomic Performance in Nigeria

  • Lawal N. A. Ekiti State University, Ado - Ekiti, Department of Banking and Finance
  • Sulaiman L. A. Ekiti State University, Ado - Ekiti, Department of Banking and Finance
  • Migiro S. O. University of Kwazulu- Natal, Durban
DOI: https://doi.org/10.22610/jebs.v10i3.2312
Keywords: Financial inclusion, macroeconomic performance, number of bank branches, OLS

Abstract

The paper examines the relationship between financial inclusion and macroeconomic performance in Nigeria from 1981 to 2014. The data for the study were sourced from Central Bank of Nigeria statistical bulletins. The study employs the Ordinary Least Square and Granger Causality tests as estimation techniques. From the result, using the coefficient, Gross Domestic Product (GDP) is positive at constant of 2573.946. This means that when all variables are held constant, there will be a positive variation up to 2573.946 units in GDP. This implies that there is a significant and positive effect of financial inclusion on macroeconomic performance in Nigeria. It is concluded that Credit to the Private Sector as a ratio of GDP (CPS/GDP), Money Supply as a ratio of GDP (MS/GDP), and Numbers of Bank Branches (NBB) have a unidirectional relationship to GDP – while Currency Out Banks (COB), Interest Rate (INT) and Total Saving (TSA)are independent of GDP. The study therefore recommends that the government and the Central Bank of Nigeria should improve on the facilitation of credit to the private sector, and money supply should be properly managed. The Central Bank of Nigeria should encourage the provisions of more bank branches to rural and urban areas in order to promote easy access to financial services.

Downloads

Download data is not yet available.

References

Abiola, A. B., Folasade, B. A. & Alexander, E. O. (2015). Financial inclusion and economic growth in Nigeria. International Journal of Economics and Financial Issues, 5 (3),629 - 637. Central Bank of Nigeria. (2012). Annual Report. www.cbn.gov.ng Collins, D., Morduch, J., Rutherford, S. & Ruthven, O. (2009). Portfolios of the poor: How the world’s poor live on $2 a day. Princeton, NJ : Princeton University Press. Friday, N. (2015). Financial inclusion and economic growth in Africa: Insight from Nigeria. European Journal of Business and Management, 7(35), 71 - 80. Hannig, A. & Jansen, S. (2010). Financial inclusion and financial stability: Current policy issues. ADBI working paper series, No. 259, Tokyo. Retrieved from http://hdl.handle.net/10419 - 53699 . Levine, R. (2005). Finance and growth: Theory and evidence. In : P. Aghion and S. Durlauf, eds, Handbook of economic growth, 1 st ed., Vol. 1. Amsterdam: Elsevier. Mbutor, O. M. & Uba, I. A. (2013). The impact of financial inclusion on monetary policy in Nigeria. Journal of Economics and international finance, 5 (8),218 - 326. Migap, J. B., Okwanya, I. & Ojeka, O. (2015). Financial inclusion for inclusive growth: The Nigerian perspective. International Journal of Information Technology and Business Management, 37(1),1 - 8. Muneer, S., Butt, B. Z. & Rehman, K. U. (2011) . A Multifactor Model of Banking Industry Stock Returns: An Emerging Market Perspective. Information Management and Business Review, 2(6), 267 - 275 Nwafor, F. U. & Anyanwaokoro, M. A. (2017). Financial inclusion and growth of the Nigeria economy. IDOSR Journal of Humanities and Social Sciences, 2 (1),26 - 38. Pasali, S. S. (2013). Where Is the cheese? Synthesizing a giant literature on causes and consequences of financial sector development. World Bank Policy Research Working Paper 6655. Washington, DC: World Bank.
Sarker, S., Ghosh, S. K. & Palit, M. (2015). Role of banking- sector to inclusive growth through inclusive finance in Bangladesh. Studies in Business and Economics, 10(2),145 - 159. Sarma , M. & Pais J. (2010). Financial inclusion and development. Journal of International Development, 23, 613 - 628. Sarma, M. (2012). Index of Financial Inclusion –A measure of Financial Sector Inclusive, Berlin working papers on money, finance, trade and Development, working paper. [Online]Available: http://finaceandtrade,titw-berlin.de (May 7, 2012) . World Bank (2013b). Universal financial access is vital to reducing poverty, innovation key to overcoming the enormous challenge, says President Jim Yong Kim. Press release . http://www.worldbank.org/en/news/press - release/2013/10/11/universal - financial - access -vital reducing- poverty- innovation -jim-yong- kim .
Published
2018-07-19
How to Cite
A., L. N., A., S. L., & O., M. S. (2018). Financial Inclusion and Macroeconomic Performance in Nigeria. Journal of Economics and Behavioral Studies, 10(3(J), 15-22. https://doi.org/10.22610/jebs.v10i3.2312
Issue
Vol 10 No 3(J) (2018)
Section
Research Paper

Copyright (c) 2018 Lawal N. A., Sulaiman L. A., Migiro S. O.

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

Author (s) should affirm that the material has not been published previously. It has not been submitted and it is not under consideration by any other journal. At the same time author (s) need to execute a publication permission agreement to assume the responsibility of the submitted content and any omissions and errors therein. After submission of a revised paper in the light of suggestions of the reviewers, editorial team edits and formats manuscripts to bring uniformity and standardization in published material.

This work will be licensed under Creative Commons Attribution 4.0 International (CC BY 4.0) and under condition of the license, users are free to read, copy, remix, transform, redistribute, download, print, search or link to the full texts of articles and even build upon their work as long as they credit the author for the original work. Moreover, as per journal policy author (s) hold and retain copyrights without any restrictions.