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Promoting formal financial inclusion in Africa: An institutional re-examination of the policies with a case study of Nigeria

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Abstract

Irrespective of the numerous regulations and over 100 years of existence, the financial sectors in most Sub-Saharan African countries have remained undeveloped and highly fragmented into informal and formal sub-sectors with very limited use of the latter. As an effective functioning financial system is fundamental to economic development of Sub-Saharan Africa, this article re-examined the policies that have been used to promote financial inclusion. Using Nigeria as a case study and focusing on her 2012 National Financial Inclusion Strategy, it is argued that the strategy like previous policies will achieve limited success due to the neo-liberal ‘one-size-fits-all’ approach of the policies, which ignores fundamental institutional peculiarities of the society (Nigeria). To create an effective financial inclusion, there is a fundamental need for a restructuring of the policies and regulations to have a deep appreciation of both the formal and informal institutional peculiarities of Sub-Saharan African countries.

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Authors and Affiliations

  1. Glasgow School for Business and Society, Glasgow Caledonian University, 70 Cowcaddens Road, Glasgow, G4 OBA, UK

    Franklin N Ngwu

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  1. Franklin N Ngwu
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1Lecturer in Finance and Financial Services at Glasgow School for Business and Society, Glasgow Caledonian University. He has a PhD in Law and Economics (Banking Sector Regulation), MSc in Economics and Post-graduate Diploma in Development Economics from the University of Manchester. In addition, he also has an MSc in Comparative Political Economy from Cardiff University and BSc in Sociology from University of Lagos. He worked at Barclays Bank for 5 years and has lectured in the Department of Economics and School of Law, University of Manchester.

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Ngwu, F. Promoting formal financial inclusion in Africa: An institutional re-examination of the policies with a case study of Nigeria. J Bank Regul 16, 306–325 (2015). https://doi.org/10.1057/jbr.2014.13

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