IMPACT OF FINANCIAL INCLUSION ON BANK PERFORMANCE IN NIGERIA

ABSTRACT

The broad objectives of this study is to examine the impact of financial inclusion on bank performance in Nigeria.  The study adopted the expost facto research design and data was extracted from the financial statement of listed deposit money banks and Central Bank of Nigeria statistical bulletin.  The study investigated twelve (12) listed deposit money banks from the period of 2018-2022. Panel least squares was used to estimate the models of the study. The findings of the study revealed that the penetration of financial services via bank branches has no significant impact on bank performance in Nigeria; The penetration of financial services through Automated Teller Machines(ATMs) has positive and significant effect on bank performance in Nigeria; The usage of financial services Small and Medium Scale Enterprises( SMEs) loans has no significant impact on bank performance in Nigeria; and the usage of financial services via online banking has negative and significant effect on bank performance in Nigeria. The study concluded that financial inclusion has mixed influence on financial performance of banks in Nigeria. The study recommended that banks should increase their presence in term of branches in the rural areas to drive full financial inclusion which would in the long-run improve the financial performance of banks; The current drive of digital financial inclusion through Automated Teller Machines (ATM)  should be sustained to allow access of financial services to the unbanked population; The current volume of Small and Medium Scale Enterprises loans should be improved upon to drive financial inclusion via loan services; and Banks should do more on cyber security to boost the usage of online banking services in driving digital financial inclusion.