The Effect of Financial Literacy on the Improvement of Financial Inclusion in Nigeria: Study of Selected Small and Medium Enterprises in Abakaliki Metropolis (original) (raw)
Related papers
Purpose: The study sought to examine the impact of financial literacy and financial inclusion on small businesses' overall performance with special reference to Southwest Nigeria. Methods: Descriptive survey research sketch was adopted for this study, while the purposive sampling method was employed to choose forty small scale businesses registered with SMEDAN from each state capital of South Western of Nigeria that engaged in petty trading, bakeries, block-making, soup-making, tailoring, and agro-allied, totaling 240 participants as a sample size for the study. Data were collected by using a closed-ended questionnaire designed for the study, while simple percentage, mean, standard deviation, Pearson Product Moment Correlation (PPMC), and Ordinary Least Square (OLS) was used to analyze the data. Results: The findings disclose that financial literacy and financial inclusion jointly and independently affect small businesses' performance. It revealed a positive and significant relationship between financial literacy and financial inclusion. However, the study depicts that majority of business operators did not have financial knowledge such as working capital management, accounting records system, financial reporting, cashbook maintenance, income statement, daily cash reconciliation, internal control on cash, and cash budget. Also, the study confirmed that the majority of small business entrepreneurs are financially excluded from micro-financing, emergency loans, employ purchase financing, business bank loans, and micro-insurance plan Services.
2023
The study examined financial inclusion and Performance of the SMEs in Ibadan, Oyo State. The financial inclusion theories and Perking Order Theory served as the theoretical background upon which this study was based. The target population for this study was made up of business centres, grocery stores and fashion houses in the Ibadan Southwest Local Government Area, Oyo State. This study adopted a quantitative survey technique because it was more explanatory and related directly to the SMEs that were selected for the research. Data was collected through primary sources with the use of a structured questionnaire to obtain relevant information from the participants as well as secondary sources. The Statistical Package for Social Sciences software programme was used to analyze the data. From the research findings, it was discovered that performance of the selected SMEs was influenced positively using financial inclusion parameters of financial service access, usage and quality as measurement. This study concluded that SMEs are crucial to the growth of the country as they use local raw materials and technology, thereby assisting in the realization of the goal of selfreliance and poverty alleviation. Finally, the study recommended that Government and financial institutions should create a comprehensive strategy to manage the wealth creating SMEs programs they have started and programs started should be properly funded in a sustainable manner and that in improving the socioeconomic development of Nigeria such as eradicating poverty, creating jobs, advancing human development and enhancing social welfare for the people, government should formulate financial inclusion methods aimed at facilitating the SMEs performance.
FINANCIAL INCLUSION AND PERFORMANCE OF MICRO, SMALL AND MEDIUM SCALE ENTERPRISES IN NIGERIA
Financial inclusion assures easy access to financial services by enabling the disadvantaged and vulnerable sections of the society to actively contribute to development and protect themselves against socioeconomic shocks. Nigeria has a sizeable rural poor population with limited access to conventional financial institutions or services. This study investigated the impact of financial inclusion on the micro, small and medium enterprises (MSMEs) performance in Nigeria. The survey research design method was used, involving the use of questionnaires, in collecting data from respondents. Data were analyzed using the Pearson Chi-square technique. The results show that, whereas financial inclusion positively and significantly impacts the operations and growth of MSMEs, distance to financial services access points and infrastructural deficiency challenged fast and effective access to financial services by MSMEs in Nigeria. The study recommends that deliberate efforts should be made to spread access points to more rural areas and improve infrastructure to promote FI. This should include a policy roadmap for expanding financial services access points to unbanked and underserved areas using the financial services geospatial map. Furthermore, the digitizing of payments across the country should be prioritized to include enhanced ICT/E-banking tools and a consumer protection framework.
International journal of business and management review, 2022
This study sought to examine the relationship between financial literacy and financial inclusion among owners/managers of SSEs in the Sunyani Municipality. Primarily, the research examined the financial literacy level, the extent of financial inclusion, and the relationship between financial literacy and financial inclusion for SSEs in Sunyani Municipality, which was necessary for their business. The study's objective employed primary data and used a mixed method approach as well as a descriptive design survey design to randomly sample 230 owners/managers from five categories of SSEs in the Sunyani Municipality. The findings revealed that managers with high financial literacy were more likely to have sound judgment about financial issues, make the right decision among financial alternatives, and have sound personal finance practices. In addition, it was found that the extent of financial inclusion depended mainly on SSEs' knowledge levels of financial products/services. The positive outcomes of being financially literate and financially inclusive were driven by behaviour such as planning expenditures and building up a financial safety net. Since financial literacy is necessary for business financial inclusiveness, it was recommended to SSEs strive for financial knowledge to enable them to make good financial decisions and aid their financial inclusiveness. Again, any policy that aims at the growth and development of SSEs with adequate training and education to help increase their financial status which will affect their financial inclusion.
INTERNATIONAL JOURNAL OF RESEARCH AND INNOVATION IN SOCIAL SCIENCE (IJRISS) , 2023
This study examines the effect of financial inclusion and financial technology on the performance of SMEs in Ekiti State. The study adopted descriptive survey research and covered all the registered 928 SMEs in Ekiti State, Nigeria; out of which 282 SMEs were sampled across the senatorial district in Ekiti State. A close-ended questionnaire was used to elicit the needed information from the sampled respondents across the study location. Pearson correlation and simple linear regression were used to analyze the responses of the respondents. However, before the administration of the instrument, validity and reliability of the instrument were carried out. It was discovered that there is a positive significant effect of availability of financial services on the performance of SMEs in Ekiti State proxied with customer satisfaction and profitability to the tune of 0.608 (p=0.036<0.05) for customer satisfaction and 0.384(p=0.002<0.05) for profitability. Also, it was revealed that a positively significant relationship exists between financial literary programs and customer satisfaction and profitability of SMEs in Ekiti State to the tune of 0.485 (p=0.042<0.05) and 0.841 (p=0.022<0.05) respectively. Furthermore, it was revealed that there is a positive significant effect of point of sales (POS) on the performance of SMEs measured with customer satisfaction and profitability in Ekiti State to the tune of 0.625 (p=0.017<0.05) for customer satisfaction and 0.434 (p=0.048<0.05) for profitability. From the findings made, it was concluded that both financial inclusion and technology contribute significantly to the performance of SMEs in Ekiti State. Based on the findings, it is therefore recommended that the owners of SMEs should engage themselves in financial literary programs.
International Journal of Economics and Financial Issues, 2022
The study aims to investigate the impact of financial inclusion on poverty alleviation among SMEs in Akwa Ibom State, Nigeria. The data collection technique employed was a self-administered questionnaire. The questionnaires were administered to a total of 295 respondents who are operators of SMEs in Akwa Ibom State, Nigeria, by using the purposive sampling technique. In analyzing the relationship among the variables, Spearman rank correlation was adopted. The study's findings revealed that financial inclusions regarding bank loans to SME operators do not correlate statistically with poverty alleviation in Akwa Ibom State. In contrast, financial inclusion regarding access to ATMs and internet banking has statistically significant correlations with poverty alleviation among SME operators in Akwa Ibom State. Hence, the policy implication of the study is that banks should reduce their interest rate to induce SME operators to access bank loans for their businesses.
INFLUENCE OF FINANCIAL INCLUSION ON SMALL AND MEDIUM ENTERPRISES GROWTH AND DEVELOPMENT IN NIGERIA
The study examined the influence of financial inclusion dimensions (mobile banking, banking services and banking penetration) on SMEs growth and development in Nigeria. The study comprises on a quantitative survey of 625 Small scale businesses. The data was collected from the business organizations operating in all local governments of Oyo State, Nigeria through a self-administered questionnaire. The study covered bakery, block making fabric making and hairdressing. Linear Regression Analysis was employed to analyse data collected. The result revealed that financial inclusion dimensions (mobile banking, banking services and banking penetration) have positive and significant influence on SMEs growth and development. Subsequently, recommendation was made that government should provide capacity building efforts that could lead to well-managed, sustainably financed SME support mechanisms especially credit guarantees.
International Journal of Research Publication and Reviews, 2024
This study investigates the impact of financial inclusion on the growth and development of small and medium enterprises (SMEs) in Lagos State, Nigeria. The research aims to explore the accessibility of financial services for SMEs, assess how these services affect their growth and development, and evaluate the acceptance of new financial technologies by these enterprises. Utilizing a positivist research philosophy and a deductive approach, the study employs a quantitative methodology, involving a survey of 204 SME owners in Lagos. The findings reveal that SMEs in Lagos have broad access to traditional financial services such as savings accounts and electronic payments but face limitations in accessing more specialized services like venture capital. Financial inclusion positively influences SME growth and development, with services like insurance and payment systems significantly contributing to operational efficiency and business success. Furthermore, SMEs demonstrate a positive acceptance of new financial technologies, particularly mobile banking and cybersecurity solutions, though the adoption of some advanced technologies, such as peer-to-peer lending platforms, remains limited. This study underscores the importance of enhancing financial service accessibility and promoting technological innovations to support SME growth. It provides valuable insights into the financial needs and technological readiness of SMEs in Lagos, offering implications for policymakers and financial institutions aiming to foster a more inclusive and supportivebusiness environment
FINANCIAL LITERACY AND FINANCIAL INCLUSION FOR ENTREPRENEURSHIP DEVELOPMENT IN NIGERIA
WEST AFRICAN JOURNAL OF BUSINESS AND MANAGEMENT SCIENCES FACULTY OF BUSINESS ADMINISTRATION, 2017
The study was conducted to determine the importance of financial literacy and financial inclusion on entrepreneurship development with the aim of accessing the knowledge of Nigerian entrepreneurs in respect to financial literacy and the availability of financial services available. Primary data was generated from the use of questionnaire. The survey covered educated entrepreneurs with the minimum of O'levels. A total sample size of 385 respondents were randomly selected from an infinite population. The study employed an ordered probit regression model for the analysis with the help of STATA (14) because both dependent and independent variables in the study are ordered in the context of multivariate latent structural model. The result with Prob > chi2 = 0.0000 showed that both financial literacy and financial inclusion influences the growth and development of entrepreneurship in Nigeria. Also, the size of Nigerian businesses and their locations have significant positive impact on the entrepreneurship growth and development in Nigeria. Hence, we conclude that increase in the financial activities in order to ensure financial literacy and financial inclusion of the Nigerian populace will have direct effect on entrepreneurship development in the country. The study identified areas of inadequacies and proposed recommendations to improve the financial literacy level and availability of financial services for entrepreneurs.
Financial Inclusion And Micro, Small And Medium Enterprises (Msmes) Development In Nigeria
International Journal of Innovation in Engineering, 2022
This study investigated the effect of financial inclusions of micro, small and medium enterprises (MSMEs) development in Nigeria. The methodology adopted for evaluation of the model is the multiple linear regression method. This choice of method is necessitated by the nature of the study which in this case is an analysis of relationship among variables. The statistical methods used included Unit root test, the Co-integration test and error correction model. Data was sourced from CBN statistical Bulletin 1981-2019. The results show that, whereas financial inclusion positively and significantly impacts the operations and development of MSMEs, distance to financial services, access points and infrastructural deficiency challenged fast and effective access to financial services by MSMEs in Nigeria. The study recommends that deliberate efforts should be made to spread access points to more rural areas and improve infrastructure to promote FI. This should include a policy roadmap for expanding financial services access points to unbanked and underserved areas using the financial services geospatial map.