BJAR British Journal of Advanced Research BJAR 3153-709X Ivory and Finch Publishers 10.68263/BJAR-3DSA6VWU BJAR_OCT_26_079 Original Research Article Agent Banking and Financial Inclusion in Nigeria Itoro Moses Ikoh, https://orcid.org/0009-0008-4662-6435 Department of Banking and Finance, Faculty of Management Sciences, University of Uyo, Uyo, Nigeria ityikoh@gmail.com Moses Ikoh Itoro https://orcid.org/0009-0008-4662-6435 Department of Banking and Finance Faculty of Management Sciences University of Uyo, Uyo, Nigeria 10 11 2026 1 5

This study evaluated the empirical effect of agent banking operations on financial inclusion in Nigeria using quarterly secondary time-series data from 2013Q1 to 2025Q4 (N = 52) observations. Financial inclusion was proxied by active formal bank account holders (LNBAH), while explanatory variables captured three core dimensions of agent activity: physical network reach via agent banking outlets (LNNAO), operational usage frequency via transaction volume (LNVOL), and monetary throughput through real transaction value (LNVAL). The study was anchored in Agency Theory as the primary framework explaining decentralised supply-side delegation, complemented by the Technology Acceptance Model (TAM) and Diffusion of Innovations (DOI) Theory. Following unit root verification, the data were analysed using the Autoregressive Distributed Lag (ARDL) bounds testing approach. Empirical results confirmed a statistically significant, long-run cointegrating relationship among the variables. Long-run estimates demonstrated that agent banking outlets (LNNAO) and transaction volume (LNVOL) exert statistically significant positive impacts on formal bank account adoption. Conversely, real transaction value (LNVAL) exhibited a statistically significant inverse long-run relationship, indicating that high-value transaction scale concentrates among existing account holders and merchant cash-outs rather than driving new account onboarding. The error-correction mechanism (CointEq(-1) = -0.4894) confirmed a rapid quarterly adjustment speed toward equilibrium. The study concludes that while asset-light physical distribution and micro-transaction frequency actively drive formal account adoption, monetary scale alone does not deepen inclusion. Consequently, regulators and commercial banks must give priority to expanding rural agent density and promoting low-cost micro-transaction services.

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