Financial inclusion and economic growth of Nigeria (the microfinance option)

• Peter A Okere

  Imo State Polytechnic, Nigeria

  Author

• Otiwu Kingsley C

  Imo State University Owerri

  Author

• Uzowuru Lawrence N

  Federal Polytechnic Nekede

  Author

• Ozuzu P.N

  Imo State University

  Author

The main focus of this study is to establish the relationship between financial inclusion and economic growth with particular reference of microfinance option for the period 1992 to 2013. Using Ordinary Least Square method and employing the Johansen Cointegration tests the study revealed that the activities of microfinance as one of the financial inclusion strategy significantly contribute to economic growth. While total loans and advances of microfinance banks significantly contribute to economic growth, total deposits inversely affect economic growth. The study also established the presence of long-run relationship between the variables considered (GDP, total loans and advances, total deposits, investments and number of microfinance banks) The study reveals that the growth and development of a nation is significantly dependent on the expansion of banking and financial services to the currently financially-excluded class of citizens of the country, as they possess untapped and unexplored valuable potentials that will be of tremendous to the country. In view of the benefits inherent in financial inclusion, this study recommends that microfinance banks should concentrate efforts on low cost deposits which are in line with their operations than competing with the conventional banks in mobilizing fixed deposits that has higher cost attached to it. Financial education is also recommended to enlighten the public on benefits of a financial superstructure.

1. Peter A Okere, Imo State Polytechnic, Nigeria

   BANKING AND FINANCE DEPARTMENT

2. Otiwu Kingsley C, Imo State University Owerri

   Dept of Banking And Finance

3. Uzowuru Lawrence N, Federal Polytechnic Nekede

   Dept of Banking And Finance

4. Ozuzu P.N, Imo State University

   School Of Postgraduates

• PDF

Copyright (c) 2018 Peter A Okere, Dr. Otiwu Kingsley C, Uzowuru Lawrence N, Ozuzu P.N

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

Copyrights for articles published in IJIER journals are retained by the authors, with first publication rights granted to the journal. The journal/publisher is not responsible for subsequent uses of the work. It is the author's responsibility to bring an infringement action if so desired by the author for more visit Copyright & License.