FinTech Adoption, Financial Literacy and Effective Financial Inclusion in Nigeria: Evidence from a Moderated Empirical Model

Abstract

This study examines whether financial literacy strengthens the relationship between FinTech adoption and effective financial inclusion in Nigeria. The paper constructs a multidimensional financial inclusion index covering access, usage, and quality of formal financial services. FinTech adoption and financial literacy are measured as composite indices, and their interaction is estimated using an OLS moderation model with heteroskedasticity-robust standard errors. The findings indicate that both FinTech adoption and financial literacy are positively associated with effective financial inclusion. Financial literacy significantly moderates the FinTech-inclusion relationship: the marginal association between FinTech adoption and effective inclusion is stronger among financially literate adults than among adults with low financial literacy. The study contributes to digital-finance literature by distinguishing access-based inclusion from effective inclusion and by integrating technology adoption with human capability. Therefore, policymakers should combine digital infrastructure expansion with financial education, consumer protection, and targeted interventions for rural residents and low-income adults to broaden adoption.