Payment System Innovations, Bank Branch Expansion, and Financial Well-Being in Nigeria

Dr. Samuel Felix Okereke, Dr. Chinedu Callistus Onyia and Shamsuddeen Ibrahim Makudawa
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Dr. Samuel Felix Okereke: Department of Economics and Development Studies , Federal University Dutsin-Ma
Dr. Chinedu Callistus Onyia: Department of Banking and Finance , Enugu State University of Science and Technology
Shamsuddeen Ibrahim Makudawa: Federal University Dutsin-Ma

East African Finance Journal, 2026, vol. 5, issue 1

Abstract: With the adoption of technological innovations in bank payment systems, banks and other financial service providers are concentrating on having more customers and improving access to finance, neglecting the customers’ financial well-being. Therefore, this study examined the nexus between payment system innovations and bank branch expansion and their influence on Nigeria’s financial well-being between 2009 and 2024. The study specifically focused on the effect of ATMs, POS, mobile technology, and the number of commercial bank branches on financial well-being as measured using the savings income ratio. Using quarterly data and the dynamic ordinary least square (DOLS) technique for the analysis, the study found that the volume of ATM transactions and bank branch expansion have a significant negative effect on financial well-being in Nigeria. It also revealed that POS and mobile phone transaction volumes are associated with improvement in financial well-being in the country. The study concludes that while the gains of technology and bank infrastructural expansion have enhanced financial access, more needs to be done to improve the country’s financial well-being. Therefore, the study recommends that fintech firms and banks should develop a product that will make low savers easily raise emergency funds with zero charges, rather than concentrating more attention on developing platforms that are increasing customers' loans.

Keywords: E-payments; Bank branch expansion.; financial well-being; DOLS (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:cwk:eafjke:2026-05

DOI: 10.59413/eafj/v5.i1.5

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