Effect of Financial Technology on Financial Sector Development in Nigeria (WORLD JOURNAL OF FINANCE AND INVESTMENT RESEARCH)

Summary

• Nigeria attracted more than $1 billion in FinTech-related investments between 2020 and 2023.p.2
• Point of Sales (POS) transactions reached ₦8.5 trillion in 2023, overtaking ATM withdrawals which totaled ₦7.2 trillion.p.2
• The digital payments segment in Nigeria is projected to reach $18.77 billion by 2024, growing at a compound annual rate of 9.58% through 2028.p.2
• Access to financial services in Nigeria expanded from 30% in 2016 to 57% in 2023.p.3
• Nigeria's financial sector development represented about 25.8% of GDP in 2022.p.3
• ETF market capitalization recorded a mean value of ₦20,809.16 million over the study period.p.10

Key insights

1. Point-of-Sale (POS) transactions exert a positive and statistically significant impact on financial sector development in Nigeria.p.1
2. ETF market capitalization exhibits a negative and statistically significant effect on financial sector development in Nigeria.p.1
3. POS transactions surpassed ATM withdrawals in 2023, signaling a major transition toward cashless transactions.p.2
4. Mobile network coverage and proximity to bank branches significantly increase mobile money adoption in Sub-Saharan Africa.p.6
5. POS usage contributed 17% to real GDP growth in Nigeria based on ARDL estimation models.p.7
6. Mobile phone transactions exert a positive and statistically significant effect on financial sector development with an estimated coefficient of 0.4312.p.12
7. The ARDL regression model accounts for approximately 0.966276 of the variations in financial sector development.p.12