Impact of Fintech Adoption on Operational Resilience and Financial Inclusion Among Small and Medium Enterprises in Nigeria's Informal Sector

Abstract

This study examines how financial technology (Fintech) adoption influences both financial inclusion and operational resilience among small and medium enterprises (SMEs) operating in Nigeria’s informal sector. Despite the sector’s significant contribution to national GDP and employment, informal SMEs often lack access to formal financial services and remain vulnerable to economic shocks and operational disruptions. Leveraging a cross-sectional survey of 60 SMEs across Kano, Lagos, and Onitsha, this research employs multiple regression analyses—augmented by explicit interaction-term estimation—to quantify the direct effects of Fintech adoption (e.g., mobile payments, digital wallets, digital lending) on composite indices of financial inclusion and operational resilience. Key moderators include firm size, geographic location, and owner education. Results indicate that Fintech adoption is a significant predictor of both financial inclusion (β = 0.687, p < .001, R² = 0.472) and operational resilience (β = 0.652, p < .001, R² = 0.425). Interaction-term analyses reveal that micro-sized firms experience a substantially attenuated Fintech–outcome relationship (β ≈ –0.50, p < .001), and those with only secondary-level educated owners derive weaker benefits (β ≈ –0.40, p < .01). In contrast, SMEs in Lagos and those with tertiary-educated proprietors do not exhibit significant moderation. These findings underscore the importance of scale and human capital in realizing Fintech’s full potential and highlight regional disparities in digital infrastructure. The paper concludes with targeted recommendations for policymakers (e.g., regional digital infrastructure investment, digital-literacy initiatives), Fintech providers (e.g., tiered pricing, user-centric design), and SME managers (e.g., strategic adoption sequencing, resilience planning). This study contributes new insights into the nuanced mechanisms through which Fintech can empower informal-sector SMEs in emerging economies.