Financial Technology (Fintech) and Commercial Bank Credit to Private Sector in Nigeria From 2019 Till Date
Chapter One
Objective of the study
- To evaluate the extent to which commercial banks in Nigeria have adopted Fintech solutions in their operations.
- To investigate the changes in commercial bank credit to the private sector over the study period.
- To Identify the factors influencing access to credit for businesses and individuals in Nigeria.
CHAPTER TWO
REVIEWED OF RELATED LITERATURE
Concept of Financial System in Nigeria
The financial system consists of various financial institutions, operators and instruments that give the system its character and uniqueness. CBN (1993) opines that the financial system refers to a set of rules and regulations and the aggregation of financial arrangements, institutions, agents, that interact with each other and the rest of the world to foster economic growth and development of a nation. According to CBN Report (2017) financial system is a prime mover of economic development, as the system ensures efficient transfer of funds to the parties that need them for investment or consumptions. All these services rendered by the financial institutions were manually done which slow or made some customers not to have access to financial services efficiently and on time. Hamilton (1804) identified that technological advancement such as the Automated Teller Machine (ATM), Online banking and bill payment, and mobile banking have enhanced customer’s experience in banking and payments, while alleviating costs, increasing convince and streamlining processes. Financial technology (fintech) is the technology and innovation that aims to compete with the traditional method of rendering financial services. This is the use of some gargets such as smart phone for mobile banking, investing services, online transactions, Point of Sales (POS). This is done with the aim of making financial services more accessible to the general public (Venkatesh and Davis 2000). The key areas financial technology has been used are insurance, trading, banking services and risk management. The banking sector has been the main driver of growth and development in the industry as they are in charge of settlement of financial commitments (Abaenewe, 2013). Most technology innovations are to support payment activities. The mostly used electronic payments in Nigeria are point of sale (POS), mobile money transfer, online money payment, etc. Abaenewe (2013) listed the following as the benefits of financial technology (Fintech) • Fast retrieval of accounts balance from the customers chosen location • Fast and efficient funds transfer • Helps customer to revisit their account transactions history at convenient • Quick ordering of bank statements. Aderonke and Charles (2010) find that ATM is still the most commonly accepted form of fintech in Nigeria
Financial Technology
Fintech represents monetary innovation and alludes to PC programming and other innovation utilized to help banking and monetary assistance conveyance (Schüffel, 2016). An innovation based development prompted the rise of new plans of action, cycles, applications and items that have critical effect on the monetary market and administrations (Derfleitner, 2017). It is essentially the utilization of monetary advances in the monetary business to work on monetary exercises (Schüffel, 2016). Fintech organizations include both new businesses and laid out organizations that are planning to supplant or if nothing else work on the utilization of monetary administrations given by occupant monetary organizations. They work in three sections of the monetary market, viz; finance, resource the executives, and installment. In the monetary fragment, Fintech organizations give supporting administrations to people and organizations in various ways, including swarm financing and group loaning.
CHAPTER THREE
RESEARCH METHODOLOGY
INTRODUCTION
In this chapter, we described the research procedure for this study. A research methodology is a research process adopted or employed to systematically and scientifically present the results of a study to the research audience viz. a vis, the study beneficiaries.
RESEARCH DESIGN
Research designs are perceived to be an overall strategy adopted by the researcher whereby different components of the study are integrated in a logical manner to effectively address a research problem. In this study, the researcher employed the survey research design. This is due to the nature of the study whereby the opinion and views of people are sampled. According to Singleton & Straits, (2009), Survey research can use quantitative research strategies (e.g., using questionnaires with numerically rated items), qualitative research strategies (e.g., using open-ended questions), or both strategies (i.e., mixed methods). As it is often used to describe and explore human behaviour, surveys are therefore frequently used in social and psychological research.
POPULATION OF THE STUDY
According to Udoyen (2019), a study population is a group of elements or individuals as the case may be, who share similar characteristics. These similar features can include location, gender, age, sex or specific interest. The emphasis on study population is that it constitutes of individuals or elements that are homogeneous in description.
This study was carried to examine Financial Technology (Fintech) and commercial bank credit to private sector in Nigeria from 2019 till date. Selected secondary resident in Lagos form the population of the study.
CHAPTER FOUR
DATA PRESENTATION AND ANALYSIS
INTRODUCTION
This chapter presents the analysis of data derived through the questionnaire and key informant interview administered on the respondents in the study area. The analysis and interpretation were derived from the findings of the study. The data analysis depicts the simple frequency and percentage of the respondents as well as interpretation of the information gathered. A total of eighty (80) questionnaires were administered to respondents of which only seventy-seven (77) were returned and validated. This was due to irregular, incomplete and inappropriate responses to some questionnaire. For this study a total of 77 was validated for the analysis.
CHAPTER FIVE
SUMMARY, CONCLUSION AND RECOMMENDATION
Introduction
It is important to ascertain that the objective of this study was to ascertain Financial Technology (Fintech) and commercial bank credit to private sector in Nigeria from 2019 till date. In the preceding chapter, the relevant data collected for this study were presented, critically analyzed and appropriate interpretation given. In this chapter, certain recommendations made which in the opinion of the researcher will be of benefits in addressing Financial Technology (Fintech) and commercial bank credit to private sector in Nigeria from 2019 till date
Summary
This study was on Financial Technology (Fintech) and commercial bank credit to private sector in Nigeria from 2019 till date. Three objectives were raised which included: To evaluate the extent to which commercial banks in Nigeria have adopted Fintech solutions in their operations, to investigate the changes in commercial bank credit to the private sector over the study period and to Identify the factors influencing access to credit for businesses and individuals in Nigeria. A total of 77 responses were received and validated from the enrolled participants where all respondents were drawn from selected residents in Lagos. Hypothesis was tested using Chi-Square statistical tool (SPSS).
Conclusion
The study on Financial Technology (Fintech) and commercial bank credit to the private sector in Nigeria from 2019 till date reveals a dynamic landscape characterized by the increasing integration of fintech solutions within the operations of commercial banks. Over the past few years, Nigerian banks have demonstrated a growing propensity to adopt fintech innovations to enhance their credit delivery processes and overall efficiency. This adoption has been driven by the imperative to remain competitive, meet evolving customer expectations, and navigate regulatory changes in the financial sector.
The findings indicate that fintech adoption has positively influenced the accessibility and efficiency of credit provision to the private sector in Nigeria. The synergy between traditional banking institutions and fintech startups has led to the development of innovative credit assessment models, streamlined loan processing, and improved customer experiences. Additionally, the proliferation of digital channels for loan disbursement and repayment has contributed to the expansion of credit access to previously underserved segments of the Nigerian economy.
However, challenges such as cybersecurity risks, regulatory uncertainties, and the digital divide persist and require concerted efforts from stakeholders to address effectively. Moreover, while fintech adoption has shown promising results, there is still room for further research to assess its long-term impact on credit quality, financial stability, and inclusive economic growth in Nigeria.
Recommendations:
- Regulatory authorities should provide clear guidelines and frameworks to facilitate responsible fintech innovation while ensuring consumer protection and financial stability. Collaboration between regulators, banks, and fintech firms is essential to create an enabling environment for sustainable fintech adoption.
- Banks should invest in staff training and development to build internal capacity for fintech integration and digital transformation. Additionally, efforts to raise awareness among bank customers about the benefits and risks of fintech-enabled credit products can enhance trust and adoption.
- Banks should continue to explore partnerships with fintech startups and technology providers to leverage their expertise and innovative solutions. These collaborations can accelerate the development and deployment of fintech-enabled credit products tailored to the needs of Nigerian businesses and consumers.
- Given the increasing reliance on digital channels for credit delivery, banks must prioritize cybersecurity measures and data protection protocols to safeguard customer information and mitigate cyber threats. Regular security audits and compliance assessments are essential to maintain trust and confidence in fintech-enabled banking services.
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