Economic and Financial Review


Central Bank of Nigeria


Microfinance; Bank, Panel Data, Sustainability, Digitalisation


The study examines microfinance sustainability in a digitalised economy using a panel dataset of 1,314 microfinance banks in Nigeria spanning 2012 to 2020. The results show that digitalisation poses significant threats to microfinance sustainability in Nigeria. The industry presently faces strong competition from commercial banks and Fintech companies, and is characterised by a low capital base, product innovation and market penetration, high transaction costs, and some idiosyncratic risks. The study suggests that microfinance institutions should leverage their large customer base by utilising digital innovations. Regulatory agencies should ensure that Fintech services are adequately regulated, affordable, and easily accessible to microfinance institutions. This would allow the microfinance industry to operate at a reduced transaction cost, increase its outreach to the poor, minimise risks and enhance sustainability.

Author Bio

The authors are staff of the Research Department, Central Bank of Nigeria, Abuja.

Publication Title

CBN Economic and Financial Review





First Page


Last Page



C23, G21, E42

Recommended Citation

Adebiyi, M. A., Olusegun T. S., & Yakubu, J. (2022). Microfinance Sustainability in a Digitalised Economy. CBN Economic and Financial Review, 60(1). 53 - 65.



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