EFFECT OF BANK UNDERCAPITALIZATION AND LOAN DELINQUENCY ON FINANCIAL INCLUSION IN NIGERIA
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Financial Inclusion involves ensuring that the poor have access to financial services that are relevant
to their needs especially in the rural communities. This study investigated the extent to which
undercapitalization of rural banks and frequent loan delinquency influence the ability of deposit
money banks to drive the inclusive growth agenda of the Central Bank of Nigeria. Out of the 250
questionnaires distributed, 179 were returned and analyzed. Being a categorical data, the study
employed optimal scaling regression to measure the relationship between the dependent and
independent variables. ANOVA and other statistical tests were also conducted. The study found that
loan delinquency, undercapitalization and payment of utility bills were significant in measuring the
inclusive growth initiative of the Central Bank of Nigeria. It therefore recommends among others that
the central bank should make policies that will increase the credit worthiness of the rural dwellers as
well as encourage banks to boost the capital base of the rural banks in order to be equipped with the
financial muscle to drive financial inclusion in Nigeria
Keywords
HG Finance