Financial Inclusion and Agricultural Output Nexus in Nigeria: An asymmetric Approach

Abstract

The desire to improve financial inclusion and achieve higher productivity in the world is becoming increasingly high in recent times. This study examines the asymmetric effect of financial inclusion proxy by the volume of automated teller machines, point of sale, mobile banking pay, and cheques on agricultural output in Nigeria. Quarterly data between 2010Q1 and 2021Q4 was sourced from the Nigerian Inter-Bank Settlement System Plc (NIBSS) and the CBN statistical bulletin 2021. The non-linear Autoregressive Distributed Lagged (NARDL) model and Stepwise Least Squares (STEPLS) were employed in the estimation. The study reveals that financial inclusion positively and significantly affect agricultural output in Nigeria, especially when proxy by the automated teller machine and point of sale. Therefore, we recommend that to achieve improved agricultural output, government and monetary authority should increase the spread of Automated Teller machines and Point of Sales, especially in the villages where agriculture is their major occupation. Also, we recommend the need to improve internet access in the rural areas of the country. This could boost agricultural output and create employment for the citizenry.