Technology and Financial Innovation: Implications for Banking, Fintech and Monetary Policy in Nigeria

Abstract

The study explored the implication of technology and financial innovation on banking, fintech, and monetary policy in Nigeria for the period 2009 2024. The study adopted an ex-post facto research design in which the regressors proxied by ATM, check, mobile pay, NEFT, POS, and web pay were regressed against the response variable in a multiple regression model using Ordinary Least Square (OLS) estimators in functional forms. Data for each of the variables was obtained from the Central Bank of Nigeria (CBN) statistical bulletin for 2024. Findings showed that financial innovation in its various forms wholly or partially has significant positive and negative impact on both banking and monetary policy. In view of the findings, it is concluded that technology and financial innovations have a significant impact on banking proxied by deposit money, bank loans, and credit to the private sector as well as monetary policy proxied by the brought money supply, exchange rate, and interest rate. In view of the findings, it was recommended that a proper regulatory framework should be put in place to check the abuse of financial innovation on the monetary system. It is also expedient that proper education should be provided to users of the technology so as to guard against cyber fraud associated with the innovations.