​The poorest people are normally excluded from formal financial services because they have limited understanding of them, because of illiteracy, or because the usefulness of the products available for their needs is limited;as well as being actively excluded by financial service providers who see them as too risky and expensive to reach (Smith et al, 2015). Many countries have now signed up to ambitious targets, Nigeria’s Financial Inclusion Strategy (Central Bank of Nigeria, 2012) has an ambitious target of including 70% of the population in formal financial services by 2020 (from a base of 30%), and reducing the proportion of financially excluded from just under half the population to one fifth. This implies including many chronically poor households.

While most of the global effort on financial inclusion has focused on extending credit, there is now mixed evidence on its efficacy in addressing the issues faced by poor people. This policy brief provides a situation analysis on financial inclusion in Nigeria, including a short analysis of how it may figure in chronic poverty, and processes of escaping poverty and impoverishment, and then goes on to assess the relevance of the four potential promising avenues identified in the global CPAN Financial inclusion Policy Guide (Smith et al 2015) for including the poorest people in Nigeria. This leads to a commentary on the e Nigerian Financial Inclusion Strategy.

Andrew Shepherd, Austine Okere, Lucy Scott and William Smith