Do Informal Financial Institutions in Nigeria Matter for Savings, Investment and Growth?
Abstract
Finance is the process of channeling funds in the form of credit, loans or invested capital to those economic units that most need them or can put them to the most productive use. On the other hand, investment connotes the accumulation and commitment of funds to an economic project with expectation to earn a higher return over time. For there to be economic growth, capital in form of physical or human must be accumulated overtime by growing the income and downsizing consumption. For finance to facilitate investment in order for growth to take place, financial institutions must pool savings and direct them to viable investments. How informal financial institutions in Nigeria have fulfilled this role in our distressed economy is the crux of this paper. Primary data were sourced from 250 customers and workers of informal financial institutions and analyzed using the Statistical Programme for Social Sciences (SPSS) version 20.
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