Financial Disintermediation and Financial Inclusion: Do Digital Financial Platforms Expand Access to Finance?

This study examined the relationship between financial disintermediation and financial inclusion in Nigeria, with particular emphasis on whether digital financial platforms have expanded access to financial services. The study investigated the effects of financial disintermediation, mobile money transactions, electronic payment values, bank branch density, and internet usage on financial inclusion using annual time-series data spanning the period 1990–2025. The study employed the Augmented Dickey–Fuller (ADF) and Dickey–Fuller Generalized Least Squares (DF-GLS) tests to determine the stationarity properties of the variables, while the Johansen cointegration test was used to examine the existence of a long-run relationship among the variables.
Furthermore, the Autoregressive Distributed Lag (ARDL) model was employed to estimate the short-run and long-run dynamics, and Pairwise Granger Causality tests were conducted to determine the direction of causality among the variables. The empirical findings revealed that financial disintermediation and bank branch expansion exert significant positive effects on financial inclusion, while mobile money transactions, electronic payment values, and internet usage exhibited mixed short-run effects but contributed to the long-run dynamics of financial inclusion. The Johansen cointegration results confirmed the existence of a stable long-run relationship among the variables, whereas the Granger causality results indicated both bidirectional and unidirectional causal relationships, suggesting strong interactions between digital financial services and financial inclusion.
The study concludes that digital financial platforms have significantly transformed the Nigerian financial system by complementing traditional banking services and improving financial access, although their effectiveness depends on supportive regulatory frameworks, adequate digital infrastructure, and improved financial literacy. Consequently, the study recommends that policymakers strengthen digital financial infrastructure, promote fintech innovation through enabling regulations, expand broadband connectivity, improve consumer protection, and intensify financial literacy programmes to accelerate inclusive financial development in Nigeria.

Financial Disintermediation; Financial Inclusion; Mobile Money; Electronic Payments; Fintech; Internet Usage; ARDL; Johansen Cointegration; Nigeria.

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