Bank Credit Dynamics and its Influence on Output Growth in the Nigerian Economy


Emmanuel A. Onwioduokit and Harold A. O’Neill(2023). Bank credit dynamics and its influence on output growth in the Nigerian economy. Munich Personal RePEc Archive, MPRA



The intricate relationship between banking credit dynamics and economic growth serves as a pivotal axis in understanding the trajectory of emerging economies. As the heartbeat of financial systems, bank credit pulsates through the economic veins, influencing and, in turn, being influenced by the broader economic landscape. In the context of Nigeria, a dynamic and rapidly evolving economy, an exploration of the multifaceted interplay between bank credit dynamics and output growth becomes both pertinent and timely.

Nigeria, as the largest economy in Africa, stands at the crossroads of economic transformation. With a diverse economic structure encompassing agriculture, manufacturing, services, and an oil￾dependent sector, the nation navigates a complex path toward sustainable growth. In this context, the role of bank credit emerges as a critical factor shaping the contours of economic development.
The dynamic nature of Nigeria’s economy demands a nuanced examination of how the ebb and flow of credit within the banking sector resonates through the broader economic canvas.

Bank credit, as the aggregate sum extended by financial institutions to individuals, businesses, and the government, serves as the lifeblood of economic activities. Its efficient allocation is not merely a financial transaction but a catalyst for private investment and an engine for economic activity (Luca and Spatafora, 2012). In the Nigerian context, where economic diversification and sustainable development are imperative, understanding the nuances of how bank credit influences output growth becomes paramount.