K. C. Onwukanjo, C. N. Anumudu, C. U. Ugwuanyi


This paper examined the impact of financial inclusion on the Nigerian economic growth for the period 1980-2019. The paper considered the three objectives during the review period. The main objective of the study is to evaluate financial inclusion significant impact on poverty reduction in Nigeria and ascertain the significant positive impact of financial inclusion on savings and investment growth in Nigerian economy. Secondary time series data were used to carry out the empirical analysis. The study specified two models that were used to examine the objectives with the aid of vector error correction model (VECM) approach, Augmented Dickey-Fuller (ADF) and Phillips-Perron (PP) tests, Co-integration Test and Granger Causality. Based on the above econometric and statistic techniques conducted, it was observed that financial inclusion has significant positive impacts on poverty reduction in Nigeria. Furthermore, financial inclusion has significant positive impact on the Nigerian savings and investment growth in Nigeria during the period of study 1980-2019. The results revealed a bidirectional nature of causality relationship between the variables in the model during the period of the study 1980-2020. These empirical results do support that one percent decrease in the interest rate (IR), inflation rate (FR) and exchange rate (EXCR) at lag (-2) will leads to [31% (IR)-2), 53%(FR)-2), and 8%(EXCR)-2)] increases on the aggregate saving (ASE) quall to investment in Nigeria. One percent increase in the financial inclusion proxy by; deposit from the rural areas (DRA), loan to rural areas (LRA), account owners of any type (AA) and electronic money banking/payment system (EMB) at lag (-2) will leads to [38%(DRA)-2), 92%(LRA)-2), 59%(AA)-2) and 03%(EMB)-2)] increases on Per capita income (PCI) respectively in Nigeria. Based on these findings, the researcher recommends that banks may consider having their forms in some locations in the officially recognized local language of the people in different regions because financial inclusion is not about ability to speak English language but access to and use of banking services. There is need for stable electricity supply to drive the infrastructural facilities provided by banks, telecommunication companies and electronic money banking/payment system such as ATMs and point of sales terminals.


Financial Inclusion, Economic growth, Poverty reduction, savings, investment, Nigeria.

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