FINTECH INNOVATIONS AND FINANCIAL INCLUSION IN NIGERIA: A CATALYST FOR SUSTAINABLE ECONOMIC DEVELOPMENT

Abstract

This study examines the effect of fintech innovations and financial inclusion in promoting sustainable economic development in Nigeria from 2009 to 2023. The study utilized a quantitative research design using secondary panel and time-series data sourced from the Central Bank of Nigeria Financial stability report, NIBSS, World Bank Global Findex and IMF reports. Fintech innovations is the independent variables proxied by mobile banking transactions (MB), point of sale transactions (POS), automated teller machine transaction (ATM), and internet banking transactions (IB). Financial inclusion, proxied by account ownership and digital payment usage, served as the mediating variable, while economic development, measured by GDP per capita growth is the dependent variable. Bank performance measures (ROA, ROE, and CAR), together with inflation and exchange-rate volatility, were introduced as control variables. Data analysis was conducted using Eviews 12 software. The methodology involved descriptive statistics, correlation analysis, and multiple regression models. The results of the study show that mobile banking transaction (MB) and point of sales transactions (POS) significantly enhanced financial inclusion, while automated teller machine transactions (ATM) negatively affected financial performance. Financial inclusion exerted a strong positive effect on GDP per capita growth and fully mediated the relationship between fintech innovations and economic development in Nigeria. The study concludes that fintech serves as a catalyst for inclusive growth in Nigeria, but its developmental potential depends on extending access to underserved groups and maintaining macroeconomic stability.