Impact of Financial Technology (Fintech) on Financial Inclusion in Nigeria

Abstract

Financial inclusion is a major strategy of sustainable development while financial technology (Fintech) has been identified as a new innovation that can be employed to achieve financial inclusion. With growing influence of Fintech in Nigeria, gains associated with a large number of people who are financially included is enormous. However, a large proportion of its population do not have adequate access to physical and technological infrastructures; that could aid financial inclusion. The impact of financial technology on financial inclusion in Nigeria is the focus of this paper. ARDL method was employed to test the relationship between Fintech and financial inclusion on a quarterly time-series data from 2009 to 2019. The empirical result of the study shows that financial technology has significant and negative impact on financial inclusion; implying that the current state of the country’s financial technology does not translate to improvement in financial inclusion in the short-run. In addition, it shows that economic growth significantly influenced financial inclusion in Nigeria on short-run and long-run basis respectively. Therefore, we recommend the need for radical collaboration among all stakeholders in Fintech industry, ministry of science, technology, National Communication Commission, and traditional saving institutions, to enhance the long-run positive impact of Fintech on financial inclusion in Nigeria.