EFFECT OF FINANCIAL INCLUSION ON THE GROWTH OF NIGERIA ECONOMY

ABSTRACT This study examined the effect of financial inclusion on the growth of Nigeria economy. The specific objectives of these study were to examine the relationship between loan to rural areas, demand deposit from rural areas, number of bank branches and GDP rate. The Finance - growth theory was adopted for the theoretical framework in this study. The hypotheses of the study were stated in null form and the study used secondary data obtained from Central Bank of Nigeria Statistical bulletin from various years and Annual Report from various years and Ordinary Least Square Regression Technique was used to test the interaction between independent variables (loan to rural areas, demand deposit from rural areas and number of bank branches) with dependent variable which is (GDP). The findings showed that financial inclusion has a significant positive effect on economic growth in Nigeria, with far-reaching implications for policy and development strategies. By providing access to credit, savings, and financial services, financial inclusion fosters increased economic activity, empowers marginalized populations, and boosts productivity across various sectors. Hence, the study recommended that banks should design loan products specifically tailored to the needs of rural populations, including farmers, small businesses, and informal sector workers, banks should shift their focus from expanding physical branches to investing in digital and mobile banking platforms, which can offer financial services more efficiently and at a lower cost, banks and financial institutions should increase the availability of credit facilities specifically targeted at rural populations, with a focus on providing accessible and affordable loans to farmers, small-scale businesses, and rural entrepreneurs.