The nexus between fintech adoption and SME financial inclusion: evidence from digital payment and lending systems in FCT-Abuja

Abstract

Although Financial Technology (FinTech) solutions are rapidly advancing in Nigeria, many Small and Medium Enterprises (SMEs) in Abuja, Federal Capital Territory (FCT), still struggle with financial inclusion due to challenges like limited credit access, low financial literacy, and reliance on informal financing sources. This study aimed to explore the impact of FinTech solutions, specifically digital payment systems, digital lending platforms, digital banking services, and financial management tools, on the financial inclusion of SMEs in FCT-Abuja. A descriptive research design was implemented, targeting a population of 98,000 registered SMEs across six area councils. Using Krejcie and Morgan’s (1970) table, a sample size of 461 respondents was calculated, and cluster and stratified random sampling methods were applied to ensure a representative sample from three main clusters: AMAC, Gwagwalada, and Kuje. Primary data were collected through a structured questionnaire distributed both physically and online, achieving an 86% response rate (397 responses). The data were analyzed using descriptive statistics and regression analysis after confirming normality and reliability. The findings showed that all four dimensions of FinTech had a positive and significant impact on financial inclusion indicators, including access, usage, quality, and literacy among SMEs. The study concluded that adopting FinTech enhances SMEs’ access to formal financial systems, boosts financial literacy, and supports sustainable business growth. It recommended that policymakers improve digital infrastructure, enhance financial education, and foster collaboration between FinTech firms and financial institutions to strengthen SME financial inclusion in Nigeria.

Keywords: , , ,   , QR-code,,  ,