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Effects of Monetary Policy on Financial Inclusion: An Empirical Evidence from Nigeria

Author

Listed:
  • Alade Raji OLAJIDE

    (Department of Business and Finance, Crescent University, Abeokuta, Ogun State)

  • Adegboyega Abdul Rasheed AFOLABI

    (Department Accounting and Finance, Chrisland University, Abeokuta, Ogun State)

  • Abiodun Osinuga TITILAYO

    (Department of Finance, Ekiti State Univesity, Ado Ekiti, Ekiti State)

Abstract

The study conducted an empirical analysis on the effects of monetary policy on financial inclusion in Nigeria from 1985 to 2019. The study employed time series research design and data were collected from the secondary source via CBN statistical bulletin. The study used autoregressive distance lag(ARDL) to achieve the objective of the study. The findings indicated that lending rate has a negative and insignificant effect on number of bank branches; money supply has a positive effect but insignificant effect on credit to SMEs; and liquidity ratio has a positive but insignificant effect on bank demand deposit. Therefore, the study concluded that monetary policy does not have significant effect on financial inclusion in Nigeria from 1985 to 2019. The study recommended that Central Bank of Nigeria as a monetary authority should redirect and redesign its monetary policy tools towards determining the financial inclusion system in the country in order to capture citizens that are financial excluded.

Suggested Citation

  • Alade Raji OLAJIDE & Adegboyega Abdul Rasheed AFOLABI & Abiodun Osinuga TITILAYO, 2022. "Effects of Monetary Policy on Financial Inclusion: An Empirical Evidence from Nigeria," Economics and Applied Informatics, "Dunarea de Jos" University of Galati, Faculty of Economics and Business Administration, issue 3, pages 74-80.
    • Handle: RePEc:ddj:fseeai:y:2022:i:3:p:74-80
    DOI: 10.35219/eai15840409290
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    References listed on IDEAS

    as
    1. srithilat, khaysy & Sun, Gang, 2017. "The Impact of Monetary Policy on Economic Development: Evidence from Lao PDR," MPRA Paper 79369, University Library of Munich, Germany, revised 27 Apr 2017.
    2. Uchenna R. Efobi & Belmondo V. Tanankem & Simplice A. Asongu & Ibukun Beecroft, 2016. "Exploring Multidimensional Financial Inclusion and Manufacturing Firms Performance in a Developing Country: The Case of Nigeria," Research Africa Network Working Papers 16/043, Research Africa Network (RAN).
    3. UFOEZE, Lawrence Olisaemeka, 2018. "Effect Of Monetary Policy On Economic Growth In Nigeria: An Empirical Investigation," Annals of Spiru Haret University, Economic Series, Universitatea Spiru Haret, vol. 9(1), pages 123-140.
    4. Afonso, José Roberto & Araújo, Eliane Cristina & Fajardo, Bernardo Guelber, 2016. "The role of fiscal and monetary policies in the Brazilian economy: Understanding recent institutional reforms and economic changes," The Quarterly Review of Economics and Finance, Elsevier, vol. 62(C), pages 41-55.
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