EXPLORING THE INFLUENCE OF FINANCIAL INCLUSION AND HUMAN CAPITAL DEVELOPMENT ON ECONOMIC GROWTH: AN ANALYSIS OF NIGERIA'S ECONOMIC INDICATORS

Abstract

This study delves into the significant roles played by financial inclusion and human capital development as catalysts for global economic growth, with a specific focus on their contributions to Nigeria's economic landscape. The analysis uses secondary data obtained from the National Bureau of Statistics and the World Bank covering the period 2000–2024. A Pooled Ordinary Least Squares (OLS) estimation technique was employed to assess the relationships among the variables. The findings reveal that bank account penetration (BAP) has a positive and significant effect on Nigeria’s GDP growth (? = 15.28430; p < 0.05), indicating that a unit increase in access to formal banking services leads to a 15.3% rise in GDP. Similarly, literacy level (DL) positively influences GDP growth (? = 9.557163; p < 0.05), demonstrating the essential role of human capital development. In contrast, inflation (LI) exerts a negative and significant impact on GDP (? = –21.48206; p < 0.05), as does poverty level (LP) (? = –19.80323; p < 0.05), implying that increases in either variable reduce economic growth. Thus, the study comes to the conclusion that human capital development and financial inclusion have a significant impact on Nigeria's financial industry and economic growth. The study also emphasizes how crucial it is to promote human development and financial inclusion as necessary components of long-term economic growth. Recommendations include advocating for the Central Bank of Nigeria to intervene in reopening closed branches of deposit money banks nationwide, particularly in rural areas. Additionally, the federal government is urged to address economic policies contributing to inflation, naira deregulation, and an increase in the poverty rate, the  study also underscore the need for sustained policy efforts that expand financial access and strengthen human development as foundations for long-term economic growth in Nigeria.