THE IMPACT OF FINANCIAL INCLUSION ON POVERTY REDUCTION AND ECONOMIC GROWTH IN MGBAKWU AND ISUANIOCHA COMMUNITIES

Abstract

Financial Inclusion is crucial for alleviating poverty and fostering economic growth in rural Nigeria, particularly in underserved communities such as Mgbakwu and Isuaniocha in Awka North Local Government Area (LGA), Anambra State. This study examines the impact of financial inclusion, emphasising fintech innovations, on poverty reduction and economic growth in these communities, with an estimated adult population of 20,000. Employing a mixed-methods approach, primary data were collected via questionnaires (n=200) and interviews (n=15-20, supplemented by secondary data from the Enhancing Financial Innovation and Access (EFInA) 2023 survey and Central Bank of Nigeria (CBN) reports. Participants were selected through stratified random sampling for questionnaires and purposive sampling for interviews. Statistical tests rejected all three null hypotheses, confirming that financial inclusion significantly reduces poverty levels (β = -0.32, p = 0.02), correlates positively with short-term economic growth (r = 0.45, p = 0.01), and is enhanced by fintech (t =2.89, p = 0.004). Fintech adoption, especially mobile money among the 18-34 age group (40% usage), drives entrepreneurship, but barriers such as inadequate digital infrastructure (80% of respondents) and low financial literacy (60% unaware of benefits) persist. Recommendations include investing in rural digital infrastructure, implementing financial literacy programmes, and strengthening regulatory frameworks to promote inclusive fintech. This study fills the knowledge gap in community-specific data and  offers policy insights for inclusive rural development.