Impact Of Education On Financial Inclusion Assignment Sample

1.1 Introduction Of The Impact Of Education On Financial Inclusion In Nigeria

Education and financial inclusion are the strategies that help in developing the project in terms of reducing the gap that is related to gender and also it has the ability to get access to services and financial products. Financial inclusion has the ability that it can transmit the risk of the financial sector (Ozili, 2021). Additionally, it can be concluded that the inclusion of finance also guarantees that it will ultimately reduce the problem related to financial capabilities. Therefore, it is obvious that it will help to improve the financial capabilities in terms of gaining the financial anatomy. The point that can also be added is that when a woman takes part in the system of finance and is also involved in promoting the growth of the economy and development a huge improvement can be seen in the system and the reason behind it is that, women have the ability that they can contribute with significance for the well-being of the community, family and also the society. Although there are so many positive sides to involving a woman in the financial system, it can be seen that the gender gap limits the procession of work still nowadays and the gender gap also reduces the level of education and access to technology. The purpose of this research paper is to show the importance of education in financial inclusion and it will specifically cover the area of Nigeria.

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1.2 Background context

Nigeria has become successful in terms of financial inclusion nowadays as they have been able to onboard the residents who belong to the banking sector. However the overall rate of exclusion is continuously exceeding the target in terms of official work, and one of the main reasons behind it is the deficiency of financial literacy. The strategy of the financial inclusion of Nigeria has to be more relevantly strategic and systematically leveraged so that they can gain the ability to develop the technology rapidly. Except for the financial services that are digital, notably mobile money is also lower in comparison of the peer countries (David et al., 2019). In terms of overcoming this situation, the Nigerian government has to improve the financial literacy among the people of Nigeria and at the same time, they have to improve the infrastructure to make it digital. The upgradation of the infrastructure digitally and the promotion of the incubation can be able to improve the condition of financial literacy. Although the rate of financial inclusion has increased in Nigeria, still it has to be mentioned that there is still a huge shortage of fulfilling the targets that have been adopted by the government of Nigeria in the year of 2012 regarding the strategy of financial inclusion. The share of the population who are adults and the shares that are related to the bank account has been increased in a continuous form, and now the accounts have more than two-thirds involvement of the individuals.

1.3 Research aim and Objectives

Aim

The main purpose of the research is to determine the impact of education on financial inclusion in Nigeria. Moreover, the aim is also to address the problems that are restricting Nigeria from achieving the goal that was adopted by the government of Nigeria in the year of 2012. One of the aims of this research is also to determine the challenges that have been faced by Nigeria in terms of providing financial education to the population of Nigeria and the way it becomes a barrier to financial inclusion.

Objectives

• To determine the impact of education on financial inclusion in Nigeria
• To evaluate how education helps in minimizing the financial discrimination and gender gaps among the people in Nigeria
• To determine the challenges in providing financial education to the people of Nigeria which is a barrier for financial inclusion there
• To emphasize on how proper financial education and training can be provided to the people of Nigeria so that financial inclusion can be achieved by them

1.4 Research questions

• What is the impact of education on financial inclusion in Nigeria?
• How can education help in minimizing the financial discrimination and gender gaps among the people in Nigeria?
• What are the challenges in providing financial education to the people of Nigeria which is a barrier for financial inclusion there?
• What are the processes in which proper financial education and training can be provided to the people of Nigeria so that financial inclusion can be achieved?

1.5 Rationale

Financial inclusion is one of the essential parts of the financial system as it can help individuals as well as the communities manage the assets that are already built it also helps to manage the condition of their finances and advises them on how they can invest their money so that they can get a considerable profit in the future. Although there is some progress that has been made for the growth of the financial condition, there is a lot of scope for improvement and the improvement has the ability to fulfil the achievement of the system of finance. Financial institutions are very crucial in terms of promoting financial inclusion, but there is no doubt that financial institutions need the help of policymakers and the government. The gender gap is one of the main problems that is faced by Nigeria in terms of financial inclusion.

1.6 Problem Statement

Problem statement in research defines the situation where the research of the study faces different kinds of problems during the time of the study to make the research paper successful and problem statement can also reduce the chance to become unsuccessful in the study. There are different areas in which the problem statement may occur such as the relevant information that is very necessary for conducting the research may not be available on reliable sources. In this research paper, which is going to be conducted on the topic of the impact of education on financial inclusion, the researcher was unable to get the information from reliable sources.

1.7 Significance of the study

Education in financial inclusion has the ability to boost the understanding of insurance and the financial product that can encourage responsible financial behaviour and it also gives people confidence so that they can be able to control their finances by themselves. Although Nigeria is performing great in financial inclusion but still, they are being unable to fulfil the goal they have adopted. These are the reasons that the study of the impact of education on financial inclusion is important.

1.8 Conclusion

In conclusion, it can be concluded that education and financial inclusion are very important for developing the financial system in Nigeria and they can also help in terms of reducing the gender gap in financial inclusion. Additionally, it can be mentioned that financial inclusion is important for making the financial sector more stable and reducing the risk in this particular sector. But for all of these, financial literacy is very important and the deficiency of financial education can be seen in Nigeria.

Chapter 2: Literature Review

2.1 Introduction

A literature review refers to a piece of writing that is related to the academic that can demonstrate understanding and knowledge of the academic literature on a topic that is specific and relevant to the research paper. A literature review has the ability that it can include an evaluation that is critical and related to the material. These are the reasons why it is called a literature review rather than a literature report. Literature review also can be considered as a survey of the sources of the scholar such as journals, articles and books. A literature review gives permission for the researcher can gain more familiarity with the knowledge that is related to the topic of the research. The literature review also can help to gain a better understanding of the theory that is involved in the research paper. Another importance of the literature review that can be mentioned is that it helps to identify the areas of the scholarship that are included in the research paper and at the same time it can prevent the duplication of the writing that can make a huge problem in the future. The literature review also gives credit to the other researchers which is essential.

2.2 Literature Review

2.2.1 Determination of the impact of education on financial inclusion in Nigeria

As per the statement of Okaro., (2016), the main principle of financial inclusion has the ability to assume importance in a greater level in recent times and the reason behind that is the perceived role of it as the growth of the economy. Financial inclusion can be considered complementary in the growth of the economy as it contributes to the alleviation of poverty. Financial inclusion is also essential for the growth of the economy as well as for the process of development because in this way more people can be involved in a financial system that is formal and it also helps to reduce the amount of money that is being provided from the banking sector. Therefore, it is obvious that it will increase the amount of money for investing. Financial inclusion defines the process that makes sure that all the members of an economy will be involved in the financial system formally.

As per the opinion of Ene et al., (2015), although the Central Bank of Nigeria (CBN) have taken an initiative in which they will encourage the banking sectors so extend their facilities and services in rural areas but still it can be seen that there are so many dwellers of the rural area who are not getting the advantages that have been promised to provide to them. The main reason behind such conditions is that the initiative taken by the Central Bank of Nigeria (CBN) has not promoted financial inclusion in rural areas properly and this is very disappointing. Therefore, the small entrepreneurs of Nigeria are suffering from a financial environment that is lacking in terms of growing their business. In recent years it has become common knowledge for the small businesses of Nigeria that they do not contribute so much to the economic growth of the country as they are suffering from the lack of access to financial services and products.

Ade Adeyemi et al., (2020), have supported that financial inclusion should be considered as a catalyst that can achieve the development in a sustainable way. A financial system that is well organized has the ability that it can distribute income to all people equally and in this way poverty can be reduced. A well-organized financial system also includes the people who were not involved in the economic system. An initiative was taken by the name of the Millennium Development Goals (MDGs) and it was adopted by a considerable number of countries in terms of reducing poverty and at the same time for the equal income of all the people and the empowerment of women. The United Nations (UN) declared MDG as one of the most successful initiatives but in Nigeria, the group of people, who are already living in so many disadvantages did not get access to the advantages of the MDG.

As per the opinion of Sani Ibrahim et al., (2019), financial inclusion is referred to as the concept of the society that can be defined among the different kinds of principles. In the major economy of Africa, South Africa is considered as the area which has the top most proportion of banks and also South Africa is the owner of the lowest pollution of the adults who are financially excluded and Nigeria is not different from the situation. Nigeria is considered to be well positioned in terms of financial, natural and human sources. The financial system of Nigeria includes the non-formal and the formal sub-sectors that are associated with the central bank for the supervisory and regulatory roles that are played by the players who are 26 in the numbers and in the formal sector. The sectors that are informal get dominated by the rotating savings and the self-help groups.

As per the statement of Babajide et al., (2015), the economy of Nigeria has been able to enjoy growth in a steady way and the gross domestic way has also faced economic growth in the last five years. Nigeria took the position of 31st in the year of 2012 as they were able to buy a huge number of power parity and they also won the exposition of eight in terms of being the largest producer of petroleum and these all affected their economy positively. The government of Nigeria have decided to give priority to financial inclusion. The target of the Nigerian government was to achieve complete financial inclusion within the year 2020. Although it can be said that the target was not fulfilled there is no doubt that they have progressed a lot positively. The reason behind it was that the strategies that were adopted by them were relevant for the financial situation of Nigeria.

2.2.2 Evaluation of how education helps in minimizing the financial discrimination and gender gaps among the people in Nigeria

As per the opinion of Adegbite and Machethe, (2020), one of the biggest challenges that is faced by the government of Nigeria while developing sustainability is the gender gap in financial inclusion. The agriculture sector of Nigeria is managed by the smallholder and they need to comprise the major part of the religion of poor people in comparison to all around the world. The problem of the gender gap has to be solved in terms of maintaining a healthy financial system in Nigeria. The only way in which this problem can be solved is education. Education about financial inclusion has to be spread so that both men and women can take part in the financial system and make it more sustainable.

Ndoya and Tsala, (2021), have confirmed that a huge level of violence against women can be seen in Nigeria and not only that but also the incidents of child marriage still happen in Nigeria, especially in the rural area. These are the reasons that women are discriminated against in the area of the financial sector still nowadays. The main reason behind the financial discrimination between men and women in the sector of financial inclusion is education. Both men and women do not get equal access to education in Nigeria. The explanation that can be given for the gender gap in financial inclusion is the difference between the capabilities of the income between both men and women. There are still some people in Nigeria who believe that the man should give priority to access to education.

As per the statement of Oguzie, (2020), the disparity of gender should be balanced by the method of initiating gender equality, and as an example, it can be mentioned that the education of women is an important part of gender equality as education is the most crucial part of life where an individual can learn how to be independent in life. The chances of getting employment should be divided equally to the man and women and in this way, the economy of Nigeria can grow positively. The households that are female-headed spend a large portion of their income in healthcare, food and most importantly in education therefore it can be said that if the mothers get financial assistance, then it will provide more benefits rather than a father getting access to the financial assistance. Promoting the equality of gender and women's empowerment are vital i n terms of accelerating the development that moves towards sustainability. Discrimination against women should be stopped and steps should be taken for not only is it a basic human right but also by following this way the economy of Nigeria can grow in a positive way.

As per the statement of OM et al., (2021), financial inclusion indicates access and use of the whole population of a country in the area of the mobile money and the financial banks and financial inclusion is important as it helps to understand the economic condition of a country. There are so many studies whose outcome has indicated that gender gap or inequality still can be seen in the countries that are developing and as a result the businesses that are managed by the female face more problems than the businesses that are faced by the male. Although women have the ability they can contribute equally to the economy such as men are doing already. There are so many ways in which the problem of gender gap can be reduced and one of the most effective ways that can be followed is providing education equally.

As per the opinion of Ye Uomo et al., (2023), in Nigeria, it can be seen that women are often excluded from education of financial inclusion although women have the ability they take part in the economic system of Nigeria. There are so many control variables that are used in the literature on empirical financial inclusion. There is no doubt that one of the most important variables that are being controlled is education. A low level of education provides for women and makes it difficult for them to be a part of the economic system and bring a change that is positive for Nigeria. Another reason for the discrimination is poverty and due to the unstable condition of finances some so many women do not even attend higher education and it is difficult for them to get the employment that they deserve.

2.2.3 Determination of the challenges in providing financial education to the people of Nigeria which is a barrier for financial inclusion there

In emerging nations like Nigeria, financial inclusion is crucial for promoting economic growth and eradicating poverty. Because it gives people the skills and knowledge, they need to make wise financial decisions, effective financial education is essential for attaining financial inclusion. Several problems prevent the proper implementation of financial literacy programmes in Nigeria. This literature review makes an effort to categorise and evaluate these worries in order to highlight their significance as obstacles to financial inclusion in the nation.

To find significant research that was published on the subject after the year 2000, a thorough search was carried out using academic databases, such as Google Scholar and JSTOR. The provision of financial education in Nigeria has major obstacles, which were discovered after a thorough study of the chosen research.

Adeleke and Siyanbola (2021) claim that the absence of physical infrastructure like ATMs and banking facilities makes it difficult to promote financial inclusion and education in Nigeria's rural communities.

• Low financial literacy: Financial literacy is low in Nigeria, where many people lack even the most basic understanding of financial ideas and products. According to Akingunola and Olowe, (2018), financial illiteracy makes it difficult to comprehend financial education activities and their potential advantages. Financial inclusion is hampered by low financial literacy since it limits people's ability to participate in the financial markets and make wise financial decisions.
• Cultural and linguistic barriers: Nigeria's population is bilingual and multicultural. Financial education courses might be difficult to understand due to communication and understanding problems, especially in rural areas. To increase community involvement and comprehension, it is essential to adapt financial education materials to local languages and cultural situations (Alabi & Yusuff, 2020).
• Lack of qualified educators: The scarcity of qualified financial educators in Nigeria is another difficulty for delivering financial education. The reason there aren't enough skilled experts managing financial education programmes is a lack of effective training and capacity-building programmes. Initiatives to develop financial literacy are less effective and have less of an impact because there aren't enough competent educators (Onugu & Igwe, 2017).
• Limited awareness and outreach: The advantages and value of financial education are unknown to many Nigerians. Inadequate outreach and awareness campaigns hinder the diffusion of knowledge about financial education initiatives, which also lessens the impact of those efforts. The importance of detailed and focused awareness campaigns is emphasised by Shogbamimu and Adeleye (2021) in order to improve financial inclusion and education in Nigeria.
• Technical obstacles: prevent Nigeria from advancing its financial literacy. The successful delivery of financial education utilising digital platforms is hampered by the lack of technology, internet connectivity, and digital infrastructure in distant locations. To ensure that everyone has equitable access to financial education, the digital divide needs to be closed (Adeleke & Siyanbola, 2021).

The issues raised in this literature study highlight the difficulties that financial inclusion and financial literacy face in Nigeria. Developing comprehensive strategies to deal with these problems is essential. These strategies should include targeted legislation, increased funding for financial literacy initiatives, programmes to build the capacity of educators, materials that are sensitive to cultural differences, increased outreach efforts, and better access to financial services and technology. Nigeria can improve financial literacy levels and promote the growth of a more equitable and sustainable financial ecosystem by successfully addressing these issues.

2.2.4 The ways in which proper financial education and training can be provided to the people of Nigeria so that financial inclusion can be achieved by them

Giving people the right financial education and training is one of the essential elements of achieving financial inclusion. Nigeria, a developing nation, has a lot of challenges to overcome in this area. The goal of this evaluation of the literature is to determine the most effective ways to give Nigerians financial education and training so they can become financially literate.

To find pertinent research published on the subject, a thorough search was carried out utilising academic sources including Google Scholar and JSTOR. Key methods for delivering financial education and training in Nigeria were found after a comprehensive evaluation of the chosen research.

One way to ensure that financial education is widely used is to incorporate it into the regular school curriculum. Through the inclusion of financial literacy courses in the primary, middle, and postsecondary levels of the curriculum, Nigeria may lay the foundation for financial literacy among the younger population.

In order to improve financial inclusion and foster responsible financial behaviour, Anyanwu, et al. (2019) found that early financial education is essential.

Public-private partnerships that bring together governmental bodies, financial institutions, and civil society organisations can successfully conduct financial education and training initiatives. Public-private partnerships may be able to provide the resources, expertise, and reach needed to increase the number of people who receive financial education.

Ogunbiyi and Odubelukor, (2019) emphasise the value of public-private partnerships in advancing financial inclusion and education in Nigeria.

Technology could help make financial education projects in Nigeria considerably more accessible and effective. People can educate themselves about financial ideas, money management strategies, and investment plans through interactive tools, online resources, and mobile applications.

Technology-driven financial education efforts, such as mobile banking and e-learning platforms, have the ability to narrow the financial education gap in Nigeria, according to Olatunji et al. (2020).

It's essential to create financial education curricula with cultural and regional relevance in mind. Material adaption for regional contexts. Engagement and comprehension can be increased by adapting content to regional languages, customs, and particular financial challenges encountered by Nigerians.

A study by Adewale et al. (2018) highlights the importance of culturally appropriate financial education materials in Nigeria as a means of overcoming linguistic and cultural barriers.

The development of a pool of qualified financial educators is necessary for the efficient delivery of financial education. Teachers can learn the knowledge and skills they need to teach financial topics and engage pupils through specialised training courses.

According to a research report by Adewale et al. (2018), certification programmes in financial education should be established to raise the proficiency of financial educators in Nigeria.

Community-based initiatives: Participating in grassroots associations, community centres, and non-governmental groups can help teach and train locals how to handle their finances. These programmes can broaden their reach, foster trust, and meet the specific needs of communities.

The public must be given the appropriate financial education and training if Nigeria is to attain financial inclusion. Some of the key strategies for advancing financial education and inclusion in Nigeria include integrating financial education into the formal education curriculum, encouraging public-private partnerships, utilising technology, adapting content to local contexts, training financial educators, and implementing community-based initiatives. Nigeria can give its people the financial knowledge and abilities they need to make wise decisions, access formal financial services, and contribute to the general economic development of the country by putting these plans into action.

2.3 Literature gap

Although the existing literature on the challenges of providing financial education and strategies for achieving financial inclusion in Nigeria provides valuable information, there are still some apparent gaps that need to be filled in future research.

Despite the fact that numerous studies have examined the challenges and strategies for delivering financial education in Nigeria, there is little emphasis on examining the impact and efficacy of financial education projects. Future research can focus on performing in-depth assessments to determine the outcomes and long-term consequences of financial education initiatives on people's monetary behaviour, decision-making, and overall financial inclusion.

Novel technological solutions have not been fully studied, despite the literature's emphasis on the potential of technology to enhance financial inclusion and education in Nigeria. Additional research should concentrate on the effectiveness of certain technological tools, like mobile applications, gamified learning settings, and digital financial services, in boosting financial literacy levels.

Lack of thorough examination of cultural and social factors Although the research emphasises the need to adapt financial education materials to local situations and cultural norms, more thorough research is still required. Future research should concentrate on the unique contextual and cultural obstacles that thwart efforts to boost financial inclusion and education in various Nigerian regions. Research on the effects of culture on financial behaviour and decision-making may be helpful in the establishment of efforts for culturally relevant financial education.

The research that already exists places little emphasis on the role of financial institutions in disseminating financial education and instead mostly concentrates on NGOs, educational institutions, and government organisations. Research on the possible responsibilities and contributions of financial institutions, such as banks and microfinance organisations, in educating their clients about money is lacking. The collaboration between financial institutions and other stakeholders to successfully include financial education into their services and products may be the subject of future research. Future research that fills in these gaps will offer a fuller understanding of the difficulties in providing financial education and methods for achieving financial inclusion in Nigeria.

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Conclusion

Conclusively, it can be said that if Nigeria is to become financially inclusive, it must provide the appropriate financial education and skills. The literature review notes the limitations, which also include a lack of educators with the necessary credentials, limited access to financial services, low financial literacy, and linguistic barriers. These issues can be handled by implementing tactics including incorporating financial education into the formal educational system, utilising technology, modifying the curriculum to meet local needs, and encouraging public-private collaborations. To assess the effectiveness of financial education initiatives, consider cutting-edge technological solutions, assess cultural and contextual aspects, and assess the involvement of financial institutions, more research is required. By filling up these knowledge gaps, Nigerians would promote inclusive financial systems and increase their financial literacy.

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