Impact of Fintech on Economic Development of Third World Countries: A Focus on Nigeria

Abstract

The digital age has ushered in a transformative shift in the financial industry, permitting financial institutions to reach previously "unbanked" consumers in emerging economies while keeping current traditional bank customers (Saal et al., 2017). The integration of technology into daily life has given rise to various technology acceptance models and unique user interactions. This study assessed the impact of FinTech on the economic development of developing countries, with a specific focus on Nigeria, to understand its contributions and identify areas for improvement. Data for this study was collected from the Central Bank of Nigeria, Macrotrends, and Statista, covering data from the past ten years, 2010 to 2020. Regression analysis was used in executing the data analysis. The selected FinTech services—ATM, PoS, and mobile payments—showed a fluctuating but generally upward trend in production and popularity, peaking in 2020, likely due to the COVID-19 pandemic. Among these, ATMs were the most popular, although PoS and mobile payments have seen significant growth since 2017 and 2019, respectively. The study concludes that FinTech has a limited impact on GDP per capita, it significantly influences consumer price index and the unemployment rate, indicating its critical role in shaping Nigeria's economic landscape.