Abstract
This study examined remittance and bank breadth in Nigeria, using data from the 2011 World Bank Households Survey for the African migration project in Nigeria. The results-based on logistic regression technique reveal - that remittance has an inverse relationship with bank breadth. The reason put forward is that recipients prefer to hold foreign exchange from remittance and they do not increase their demand for banking services. One of the key implications of the findings is the need for commercial banks to go beyond mere serving as liaison for remittance but incorporating elements of advisory services to the customers, especially those that frequently receive remittance, on how they can best utilize such fund for productive activities.
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Notes
Apart from opening of bank branches, we are aware that electronic banking platforms can enhance bank breadth. However, many Nigerians are more comfortable in dealing with physical bank branches than electronic platforms. As has been shown by a recent report (Ladipo 2014), a well of 70 % of individuals has preference in receiving and making payments by dealing with banks’ physical branches than any other means.
available at http://microdata.worldbank.org/index.php/catalog/402
This is based on the current exchange rate of ₦157.50 to US$1.00. Naira (₦) is the local currency (LCU)
We categorized the recipients into two groups (those that received remittance less than 10 times and more than 10 times in a year)
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Acknowledgments
We are grateful to Yi Huang, Shamika Ravi, and Kim Wilson, as well as session participants at the OIKOS Young Scholars Economics Academy, 2013, where the first draft of this paper was presented. We also appreciate the financial support from OIKOS to attend the academy. The constructive comments from the reviewers are also acknowledged.
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Uchenna, E., Evans, O.S. & Stephen, O. One Dollar, One Bank Account: Remittance and Bank Breadth in Nigeria. Int. Migration & Integration 16, 761–781 (2015). https://doi.org/10.1007/s12134-014-0358-0
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DOI: https://doi.org/10.1007/s12134-014-0358-0