EFFECT OF MICROFINANCE BANKS’ FINANCIAL INCLUSION STRATEGIES ON ECONOMIC GROWTH OF NIGERIA (2009-2018)

Godwin O Ofeimun
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Godwin O Ofeimun: Department of Accounting and Finance, Faculty of Humanities, Social and Management Sciences, Edwin Clark University, Kiagbodo-Delta State, Nigeria

Noble International Journal of Economics and Financial Research, 2020, vol. 5, issue 1, 14-23

Abstract: This study ascertained the effect of Microfinance Banks’ financial inclusion strategies on economic growth of Nigeria. The motive behind this study is to contribute to the debate on access to finance by the active poor and small and medium enterprises (SMEs) and to close the knowledge gap in literature on the effect of microfinance banks’ financial inclusion strategies on the Nigerian economy. This study was carried out to examine the role of micro-financing as a vehicle for promoting economic growth through financial inclusion. This study adopted the ex-post facto research design. The data used for this study were secondary data and obtained from Central Bank of Nigeria (CBN) statistical Bulletin, Annual reports and statements of accounts of microfinance Banks as well as the publications of the National Bureau of Statistics (NBS) for the period 2009 – 2018. The study used the ordinary least square (OLS) regression analysis as the data analytical method.  Findings of the study revealed that micro loan disbursed, loan to SMEs have a significant positive effect on economic development in Nigeria. Moreover, the study finds that bank deposit has a negative but insignificant relationship with economic development. The study therefore concluded that financial inclusion strategies by microfinance banks have a great effect in stimulating the economy. The study recommended amongst others that the policies and programmes to influence the establishment of microfinance banks in rural communities should be encouraged to enhance access to credit, encourage banking habits among the rural dwellers, ensure even rural development and growth of small businesses.

Keywords: Financial Inclusion; Economic Development; Micro Loan Disbursed; Small and Medium Enterprises; Per Capita Income (search for similar items in EconPapers)
Date: 2020
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