Financial Development and Economic Growth in Nigeria

The study examined impact of financial development on economic growth in Nigeria from 1980-2020. The study decomposed financial development into three measurable variables as Financial Institution’s Depth (FID), Financial Institution’s Access (FIA) and Financial Institution’s Efficiency (FIE) while economic growth was measured by Gross Domestic Product (GDP). The study utilized ex post facto research design with secondary data extracted from the Central Bank of Nigeria (CBN) Statistical bulletin for various years and International Monetary Fund (IMF) data base. The said data were analyzed by means of descriptive statistics and multiple regression analysis to provide summary statistics for the variables. The result revealed that financial institution’s depth has a negative significant impact on economic growth in Nigeria with a probability value of 0.0305 and coefficient of -4169.955, financial institution’s access also has positive and significant relationship with economic growth in Nigeria with a probability value of 0.000 and coefficient of 5967.794 while financial institution’s efficiency does not impact on economic growth in Nigeria based a probability value of 0.59907 and coefficient of 74.75227. Flowing from the foregoing statistical findings, the study concluded that financial development has significant impact on economic growth in Nigeria. And the study therefore recommended that financial institutions should strive to enhance the financial depth and financial accessibility given that it positively impacts economic growth.