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Abstract This study delves into the intricate relationship between digital finance infrastructure and the growth of commercial banking firms in Nigeria. Through a comprehensive analysis of various financial indicators and statistical tests, we offer critical insights into the dynamics of the Nigerian banking sector. The findings reveal a resilient and steadily growing banking industry, even in the face of economic challenges and the global COVID-19 pandemic. Key highlights include the exponential rise in digital infrastructure, exemplified by the proliferation of Automated Teller Machines (ATMs), Point of Sale (POS) machines, and web banking accounts. These digital channels have significantly influenced the accessibility and convenience of banking services in Nigeria. Our analysis employs correlation, regression, and Granger causality tests to explore the intricate relationships between bank total assets and digital infrastructure components. While positive correlations between bank total assets and digital infrastructure components suggest a strong link between technological expansion and banking growth, the analysis reveals nuanced relationships. Particularly, the unexpected negative impact of ATMs on bank total assets warrants further investigation. The decline in the number of POS machines in 2022 poses questions about the factors contributing to this trend. Furthermore, while web banking accounts have grown significantly, their influence on bank total assets remains limited. Our findings emphasize the paramount importance of continued investments in digital finance infrastructure for the Nigerian banking sector's growth. However, they also underscore the need for a more profound understanding of the underlying drivers of these trends. This study offers valuable insights for policymakers, financial institutions, and researchers interested in fostering financial inclusion and optimizing digital banking services in Nigeria's ever-evolving financial landscape.
Iwedi Marshal (Mon,) studied this question.