Accelerating Financial Inclusion for Sustainable Development in Nigeria

Abstract

Financial exclusion constitutes a major sustainable development challenge in many developing countries such as Nigeria. This paper examines the financial inclusion efforts in Nigeria, the implications of strong financial inclusion for sustainable development, and the challenges militating against financial inclusion in Nigeria. The paper also discusses the roles of rural banking scheme, Nigeria Deposit Insurance Corporation, and various types of banks as well as the non-interest banking policy and alternative banking channels in financial inclusion. The paper suggests that a strong financial inclusion of the hitherto inadvertently financially excluded and the poor segments of the society would increase economic activities, employment, consumption, government expenditure as well as economic growth and sustainable development. It also identifies the challenges militating financial inclusion in Nigeria to include; low financial literacy, cumbersome banking documentation and minimum operating balance requirements, inadequate and uneven distribution of bank branches and alternative banking channels, low uptime and malfunctioning of e-channels, growing poverty incidence, and high unemployment rate, among others. The paper recommends the re-introduction of rural banking scheme, public enlightenment, minimization of banking documentation and minimum operating balance, increased deployment of alternative banking channels, and stiffer penalty against corruption, among others. A strict implementation of the suggested recommendations would accelerate financial inclusion and ensure sustainable development in Nigeria.

Keywords: Financial inclusion, Financial exclusion, Sustainable Development, Nigeria

DOI: 10.7176/RJFA/12-16-05

Publication date:August 31^st 2021