ISLAMIC BANKING AND FINANCIAL INCLUSION IN NORTHWESTERN NIGERIA: A QUANTITATIVE ANALYSIS

Abstract

  This study examines the relationship between Islamic banking and financial inclusion in Northwestern Nigeria, addressing the gap in existing literature on the role of Shariah-compliant financial products, banking infrastructure, and adherence to Shariah principles in fostering financial inclusion. Using a quantitative approach, data were collected from 321 respondents through structured questionnaires and analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM). The findings reveal that the presence of Islamic banking branches and outlets (PIBO) has the most significant positive impact on financial inclusion, while adherence to Shariah compliance (ASC) also fosters trust and encourages participation in formal financial systems. However, the availability of Shariah-compliant products (ASCP) alone does not significantly enhance financial inclusion without improved accessibility and awareness. The study concludes that expanding Islamic banking infrastructure, promoting financial literacy, and ensuring strict adherence to Shariah principles are critical for enhancing financial inclusion in the region. Recommendations include increasing the number of Islamic banking branches, launching targeted financial education programs, simplifying Shariah-compliant products, and addressing gender disparities in financial access. Future research should explore longitudinal and comparative studies, the impact of digital banking, and the socio-economic effects of Islamic banking to further inform policy and practice