Banking, National savings, Financial sector, Savings.


It is often held that capital accumulation is necessary and sufficient condition for growth and capital accumulation is almost synonymous with saving, hence the route to growth is then one of raising savings and smoothing consumption (Deaton, 1991). Savings is one of the key relevant macroeconomic variables in any economy. Its impact on the rate of capital accumulation, productivity and the degree of dependency of a nation on foreign capital and foreign ownership of domestic assets cannot be overemphasised. This paper reviews conceptual issues on savings behaviour in Nigeria. It also provided an analysis of the factors that may have led to weak saving performance, as well as some suggestions about future behaviour of savings through a review of the literature. The study found that even though the number of financial institutions has increased, saving mobilisation has not increased appreciably. The need to enhance investment and economic growth potentials calls for measures to mobilise savings both in the short run and long-run. First, the constraints to mobilisation of savings has been identified to include financial repression, fiscal deficits, scanty saving instruments, near non monetisation of the economy, externalities, negative deposit rates, among others. Consequently, measures suggested to stimulate savings include financial liberalisation and removal of all distortion to savings, savings enlightenment programme and adopting positive savings culture attitude, introduction of more savings instruments, development of the money and capital markets, reduction of fiscal deficits, macroeconomic stability, and continuation of democracy to ensure stability.

Author Bio

The authors are staff of University of Abuja, Nigeria.

Publication Title

CBN Bullion







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