Deposit Money Banks Disruptive Innovations And Financial Inclusions In Nigeria

This study examined the impact of deposit money banks’ disruptive innovation on financial inclusion in Nigeria. The broad objective of this study is to ascertain the impact of banking innovations on financial inclusion in Nigeria. The analysis spans from 2011 to 2023, utilizing quarterly time series data sourced from the World Bank database. The variables examined include the number of Deposit Money Bank branches (a proxy for financial inclusion), the number of Automated Teller Machines (a proxy for banking innovations), institutional quality, income level, financial depth, access to electricity, and an interaction term between the number of ATMs and institutional quality. The Autoregressive Distributed Lag Model was the method of estimation employed in the study. The findings indicate that banking innovations and Financial Inclusion do not have a significant long-run linear relationship, and that the number of Automated teller machines (ATMs), which serves as a proxy for banking innovations, has a positive and significant impact on financial inclusion. This study also found a significant impact of the interaction between banking innovations and government institutions on Financial Inclusion in Nigeria. Consequently, the study recommends that government institutions foster public-private partnerships, such as the Shared Agent Network Expansion Facility (SANEF), to promote banking innovations. Additionally, the government, through the Central Bank of Nigeria (CBN), should implement policies to enhance the deployment and functionality of ATMs nationwide and promote financial literacy programmes