A Multi- Sectoral Study of Financial Inclusion and Econmic Output in Nigeria
This study evaluates the causal links between financial inclusion and economic output, as well as between financial inclusion and the five sectors of the Nigerian economy using eointegration and Granger causality test. The results suggest that there is bi-directional causality between financial inclusion and the aggregate economy. In most cases, there is bi-directional causality between financial inclusion and the sectors of the economy as well. This study also shows that financial usage has higher causal links with the economy and its sectors than financial access. Thus, a responsible pursuit offinancial inclusion in Nigeria will emphasize not only creation of access tofinance, but most importantly, its usage. This study establishes financial inclusion as a potent accelerator of economic progress, which can help realize the national objectives of building shared prosperity and abolishing extreme poverty. For policymakers, the message is clear: Mainstream rural credit from banks and other financial intermediaries in such a way as to realize increased coverage, broaden financial inclusion and stimulate output.