INFLUENCE OF SAVINGS MOBILIZATION IN NIGERIA
Abstract
This study examined the influence of savings mobilization in Nigeria from 1990 to 2022. The objectives were to analyze the impact of household income, deposit interest rates, and inflation rates on savings mobilization. An ex-post facto research design was adopted using secondary data. The data were analyzed using descriptive statistics, correlation analysis, and ARDL regression. The findings indicate that the deposit interest rate has an insignificant positive effect on savings mobilization in Nigeria. Higher interest rates induce greater financial savings by making saving more rewarding. The inflation rate has an insignificant negative effect on savings mobilization. The study concludes that appropriate management of the deposit interest rate is crucial for mobilizing savings, with positive real deposit interest rates below 10% inflation being historically more favourable. Household income and the inflation rate have a limited impact on savings mobilization, unlike deposit interest rates. Overall, the findings justify prioritizing price and monetary stability to incentivize savings mobilization, given its importance for investment and growth. The study offers insights to guide policy aimed at mobilizing higher domestic savings in Nigeria.