Financial Inclusion and Macroeconomic Stability As a Panacea for Poverty Reduction in Nigeria: An Empirical Analysis

Mabinuori, Oladotun T. and Matthew, Oluwatoyin and Bowale, Ebenezer I.K (2023) Financial Inclusion and Macroeconomic Stability As a Panacea for Poverty Reduction in Nigeria: An Empirical Analysis. Innovations (73). pp. 1428-1439.

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Abstract

The study evaluated the impact of financial inclusion as a panacea for poverty reduction in Nigeria. It employed the Johansen cointegration test and the Granger causality test as an analytical technique based on the outcome of the unit root test conducted. The study found that the Trace test indicates eight co-integrating variables while the maximum Eigenvalue indicates three co-integrating variables at a 5% level of significance. The result showed that there exists a long-run relationship between financial inclusion, macroeconomic stability, and poverty reduction in Nigeria. The Error Correction Mechanism (ECM) test revealed that about 29 per cent of disequilibria in Nigeria’s poverty gap ratios in the previous years are corrected for in the current year. The Granger causality result revealed that the financial inclusion index, government revenue, government expenditure, money supply, interest rate, and the number of deposit money banks do not have a causal relationship with poverty gap ratios, while inflation rate as a uni-directional causal relationship with poverty gap ratios in Nigeria and conclude that there is no causal relationship between financial inclusion, macroeconomic stability, and poverty reduction in Nigeria. Based on the findings, the study recommended that the financial sector in Nigeria needs to expand financial markets and engineer financial services and products particularly dedicated to the requirement of the low-income and rural segment of the population to ensure the availability, accessibility, and usability of financial services, thereby aiming to eradicate poverty and reduce income inequality in the rural and urban areas.

Item Type:	Article
Uncontrolled Keywords:	Financial Inclusion, Government Revenue. Government Expenditure, Macroeconomic Stability, Poverty Reduction
Subjects:	H Social Sciences > H Social Sciences (General) H Social Sciences > HC Economic History and Conditions H Social Sciences > HN Social history and conditions. Social problems. Social reform
Divisions:	Faculty of Law, Arts and Social Sciences > School of Management Faculty of Law, Arts and Social Sciences > School of Social Sciences
Depositing User:	Patricia Nwokealisi
Date Deposited:	20 Feb 2025 13:09
Last Modified:	20 Feb 2025 13:09
URI:	http://eprints.covenantuniversity.edu.ng/id/eprint/18812

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