Credit Facilities Research Articles

Investing in Rural Agriculture in the Face of Innovative Financial Services: Does Financial Literacy Matter in Nigeria?

The complex nature of formal financial products and services and the frequently associated innovations occasioned by disruptive technologies inform researchers’ calls for studies on financial literacy, particularly in African rural communities. As a response to the calls, this study explores how financial literacy relates to performance, access to credit facilities, and payment preferences among smallholder rural farmers in Nigeria. Further, the rural farmers’ financial literacy level on each of the four dimensions of the Standard and Poor Global Financial Literacy criteria was assessed. A random sample was drawn from the registered rural farmers in the Central Bank of Nigeria’s Anchored Borrower’s Program for the 2022 farming year. Quantitative data were collected from rural farmers using the Standard and Poor Global Financial Literacy questionnaire. The proposed hypotheses were tested with partial least squares structural equation modeling (PLS-SEM), while descriptive statistics were used to analyze the data. The outcomes show that financial literacy significantly predicts performance, access to credit facilities, and mode of payment preferences among smallholder rural farmers. Also, the analyses of the four dimensions of financial literacy show that the farmers are more literate in risk diversification and inflation than numeracy and compound interest. It is concluded that financial literacy is cardinal to profitable investments in rural farming, and as such, there is a need for the Nigerian government and financial authorities to embark on financial literacy drive with more emphasis on numeracy and compound interest where the rural farmers are more deficient.

Synergizing Women’s Health and Microfinance Programs through Self-Help Groups for Empowering Communities in India

Microfinance has evolved as a poverty alleviation tool, yet without addressing health, it will only have a limited impact, as poor health can contribute to increased poverty. This research examines a different approach to integrating initiatives that concern women’s health with microfinance programs through Self-Help Groups (SHGs) in India. It is based on a case study method where various case models integrating microfinance and health interventions are studied. In this regard, this article analyzes various cases from several states in India with a focus on the use of SHGs as an effective platform for delivering health education, services, and financial products designed to meet the specific needs of women. The research shows that SHGs are crucial for enabling their members' access to credit facilities, income-generating opportunities, and primary health care, which are necessary for fostering an environment suitable for empowering women and developing community structures. Thus, this study concludes that when applied together, such initiatives promote better health indices and augment female economic activities and decision-making ability.

Determinants of microfinance credit uptake and the amount of credit by smallholder dairy cattle farmers in Maara sub-county, Tharaka Nithi County, Kenya

Microfinance institutions play a crucial role in enhancing the production and productivity of smallholder farmers by providing them with the necessary financial resources. However, the adoption and utilization of microfinance credit in the Maara sub-county fall short of their potential benefits. Despite various credit service providers, not all smallholder dairy cattle farmers in this region have been able to capitalize on these services. Several factors contribute to the low uptake of microfinance credit among smallholder dairy farmers, including inadequate financial literacy, absence of collateral, high transaction costs, and insufficient infrastructure. Acknowledging that these factors are dynamic and can vary across different regions is and essential. Therefore, a comprehensive understanding of the dynamics influencing microfinance credit adoption and utilization in the Maara sub-county is lacking. This study examined microfinance credit uptake from two angles: the factors affecting its adoption and the determinants of credit size once accessed. Recognizing the interdependence of these choices, the study employed the Heckman selection model. Results indicated that factors such as years of schooling, household size, organization membership, access to extension services, and collateral availability significantly (p < 0.01) influenced microfinance credit uptake. Furthermore, schooling years, household size, and daily milk production per cow emerged as the most impactful credit size determinants (p < 0.05). The study suggests that promoting organization membership among smallholder dairy cattle farmers could enhance access to microfinance credit facilities, thereby ensuring sustainable milk production. By addressing the identified factors, the Maara sub-county could unlock the potential of microfinance credit to benefit its agricultural sector.

Complexities and opportunities: A review of the trajectory of fish farming in Zimbabwe

AbstractZimbabwe is currently rated as one of the top 10 fish producers in Sub‐Saharan Africa. Fish farming in Zimbabwe is dominated by the culture of Nile tilapia (Oreochromis niloticus) followed by rainbow trout (Oncorhynchus mykiss). Over 90% of the cultured fish is O. niloticus, which comes from Lake Kariba. Since the first decade of the 21st century, there has been a significant increase in fish production from two tons to eight tons annually. The increase in fish production has been attributed to the government and donor‐funded fishery programs. In this review, current practices, opportunities, and challenges for aquaculture in Zimbabwe are highlighted. The current practices include intensive, semi‐intensive, and extensive aquaculture systems. Consistent high market demand for fish and numerous water bodies with potential for cage culture are some of the drivers for aquaculture. Despite the industry's significant growth, there are still a number of management and production issues that need to be resolved. Weaknesses in structural issues and operational frameworks in Non‐Governmental Organizations, lack of credit facilities, subsidies, limited technology, obfuscated governance, weak fish disease surveillance mechanisms and legal frameworks, and constrained human resources capacity are some of the challenges plaguing fish culture in Zimbabwe. Cogent aquaculture policies, sustainable subsidies, intensive training of human resources and fisheries experts, strengthened disease surveillance, cheaper alternative fish feeds, reliable viable fingerling production, concerted value chain efforts, and exploration of lucrative export markets is a panacea for the fledgling aquaculture industry in Zimbabwe.

Training need assessment of women members in selected farmer producer organizations (FPOs) of Karnataka

Agriculture sector provides gainful employment and livelihood for majority of the population and contributes significantly to the national income and in India it accounts for 17.60 per cent of it’s Gross Domestic Product (GDP). Indian agricultural sector facing several challenges like small and fragmented land-holdings, climate change, diversification due to rapid urbanization, inadequate market and storage facilities, unorganized sector, lack of credit facilities and low knowledge on supply chain management and business plans. Hence the study was conducted in Karnataka during the year of 2022- 23. Study was carried out in three Farmer Producer Organizations (FPOs) from Karnataka have been selected. A total of 90 women members constitute the sample size. Data was collected through interview schedule and analyzed through mean scores and index percentage. Study concludes that, highest index score 81.11 was observed for training on skills for marketing of products at large scale and business skills and ranked I. Whereas, highest index score in personal constraint, expressed by majority of the women members was, they were unable to manage time between household work and FPO work with index score of (86.66) and it ranked I. With regard to marketing majority expressed that, price fluctuation every year and distress sale as a constraint with index score 81.11 and ranked I. Great majority (93.33) of FPO members expressed that, high initial share capital/membership charge in FPOs as a constraint and ranked I in administration. With respect to services and benefits more than half (56.66) of the respondents expressed that, non- availability of custom hiring services at FPO as a constrain and ranked I. Study results also indicated that great majority (93.33) of FPO members suggested that, they want proper guidance towards packaging, grading, branding, processing and marketing especially for value added products should be given by FPOs for better participation.

Impact of credit access of farmers in cooperative societies on financial performance: the predictive effect of financial literacy

PurposeThe goal of this study was to determine the impact of access to credit facilities on financial performance among farmers of cooperative societies. The study also tested the predictive power of financial literacy.Design/methodology/approachThe descriptive survey research design was used for the study while the sample size was 240 farmers of cooperative societies from South-East Nigeria. The farmers were categorised into those with access to credit facilities and those without access to credit facilities. A structured questionnaire was used to collect data for the study. Data were analysed using multiple analyses of variance (MANOVA) and multiple regression analysis.FindingsFarmers with access to credit facilities reported higher financial performance such as return on investment, working capital, net profit, profit margin and sales. However, those without access to credit facilities reported lower mean scores on financial performance. Also, financial literacy, like financial knowledge, attitude and awareness, significantly predicts the impact of access to credit facilities on financial performance. It was also found that the duration of repayment of credit facilities, like medium and long term, contributes more to improving financial performance.Originality/valueThis study has shown that even though access to credit facilities impacts financial performance, financial literacy is an important consideration. Also, the duration of repayment is a crucial factor.

Assessing Structural Transformation and the Potential Impacts of Belt and Road Initiative Projects in Africa

Infrastructure development, central to the Belt and Road Initiative (BRI), is crucial for facilitating structural transformation. However, numerous critics contend that the Initiative serves as a tool for China to engage in debt-trap diplomacy, which fails to deliver actual development in Africa. Therefore, assessing whether BRI projects will facilitate the necessary structural transformation in these countries requires meticulous analysis. Given the extended project cycle typical of infrastructure development, evaluating the overall socioeconomic impacts of the BRI is challenging. Nonetheless, these projects are likely to be implemented as part of the expansion of China's existing model for overseas infrastructure projects. This model is characterized by a reliance on concessional loans and credit facilities for financing, and state-owned enterprises as contractors. Contrary to the debt-trap diplomacy narrative, our findings, based on panel data and staggered difference-in-differences analysis, indicate that Chinese projects have positively impacted multiple aspects of Africa's structural transformation process.

Climate Change Vulnerability and Adaptation Strategies of Rice Cultivators in Odisha, India

In the present era, climate change is the biggest challenge for the world. The vulnerability of climate change to India’s agriculture sector is quite evident. Due to its geographical existence, climate change is creating a vulnerable situation in the eastern part of India. Odisha's economy is one of the most affected in this regard. The agriculture sector, being the common practice of livelihood, is always sensitive to climate change. The unpredictable rainfall patterns, floods, droughts, and frequent cyclones have caused severe damage to crops and livestock, leading to a lack of employment and a vulnerable situation for farmer households. Therefore, this study employed the LVI approach to evaluate farmers' climate change vulnerability and used the probit model to identify the factors influencing farmers' adaptation options. To accomplish the stated objective, both primary and secondary data have been used. Primary data have been collected from four blocks (Athagarh, Cuttack Sadar, Barang, and Banki) of Cuttack districts, Odisha, where most of the farmers are marginal farmers. The LVI combined nine major components and 33 subcomponents under it, which establishes a specific functional relationship with vulnerability. The vulnerability assessment indicates that Cuttack district is moderately vulnerable to climate change, with a 0.41 vulnerability score. Social network and livelihood strategies are the major scoring indices in this regard, with 0.90 and 0.65 LVI values, respectively. The probit model found that farming experience and non-farm income are detrimental factors for adopting any strategies to combat climate change. The policy options are precautionary measures that are required to withstand the negative effects of climate change. Therefore, effective government steps required in creating an awareness program, extending training facilities to the farmers, and proper provisioning of irrigation and credit facilities are highly essential for increasing crop productivity and reducing the vulnerability of the farmer household.

A Bibliometric Analysis of Borrowers’ Behavior

Understanding borrowers’ behavior is essential in making lending decisions, strengthening financial inclusion, and alleviating poverty. This research adopts a bibliometric approach to provide an overview of the borrower’s behavior relative to the selected literature. Bibliometric analysis quantifies the impact and quality of scientific production. This study reviewed 989 articles obtained from SCOPUS and published from 1987 to 2023. Data were cleaned, formatted, and analyzed using VOS viewer (1.6.19) and the R-Bibliometrix package. The research established an increased interest in borrowers’ behavior among scholars. Nonetheless, it is overshadowed by studies in lending behavior, microfinance, banking, peer-to-peer lending, and fintech. The scholarly focus is mainly on the supply side of the credit industry with little regard to demand-side dynamics, such as borrowers’ decision-making processes, which can affect the performance of credit facilities. This study recommends that further studies on credit facility demand-side dynamics should be carried out to understand the drivers of borrowers’ decisions.

The Effect of Interest Rate Risk on Financial Performance with the Mediating Variable of Banking Security Level (Study on Commercial Banks that Go Public in BEI)

Rapid internal and external development has been witnessed by the banking industry, particularly at the domestic level, where the usage of innovative financial instruments has grown dramatically. Banks mediate transactions between different economic activity, receive deposits, create money, and offer thorough banking services to individuals, organizations, and other banks. They also provide credit facilities. As a measure of a nation's spending and investing habits, the interest rate plays a significant role in conserving money and choosing how to spend it. Banking institutions are beginning to understand the significance of risk management in preparing for potential threats to their businesses. Banking executives in Indonesia must mitigate these risks by enhancing their institutions' bottom lines. The purpose of this research was to examine the relationship between interest rate risk and financial performance in Indonesian banking organizations, with the level of banking security serving as a moderation variable. This quantitative analysis employs a sample of 24 commercial banks that have listed on the IDX between 2019 and 2022 as its research population. The findings shown that Interest Rate Risk significantly impacts Banking Security Level, Financial Performance, and Financial Performance via Interest Rate Risk via Banking Security Level.

Determinants of poverty and welfare among oil palm processors in Osun state

The study analyzed the determinants of poverty and welfare among oil palm processors in Osun state. The specific objectives were to examine the housing and living conditions of oil palm processors in the study area, study the extent of poverty among oil palm processors in the study area, and determine the factors influencing the welfare of oil palm processors in the study area. Primary data were collected from 160 oil palm processors through purposive and random sampling techniques. Descriptive statistics, FGT measure of poverty, and Tobit regression model were used as analytical tools. The study revealed that about 76.9 percent of the processors were female. Majority (56.875 percent) of the processing households have accommodation of their own. The results of the FGT show that about 93 percent of the respondents were poor with a poverty incidence (P0) of 0.93125, poverty depth (P1) of 0.787129 and a poverty severity (P2) of 0.695926. The Tobit regression model reveal that household size and processing method used contributes positively to the likelihood of being poor and both are significant at 5%. While access to credit, years of processing experience and monthly income contributes negatively to the likelihood of being poor which are all significant at 5%. This study recommends that policies which will reduce household size such as fertility control measures should be the focus upon. Also policy should focus more on providing credit facilities through cooperative societies in other to help them improve their welfare status.

Impact of micro finance banks on poverty alleviation in Ondo state, Nigeria

The study investigates the impact of microfinance banks on poverty alleviation in Ondo state, Nigeria. A simple random sampling technique was used to collect primary data from both customers and the staff of some selected micro finance banks in the state. The data collected from respondents through structured questionnaire were analyzed using descriptive statistics. Descriptive statistics such as frequency count and simple percentage were used to analyze the data gathered. The chi square was used to test the hypotheses of the study at 0.05 levels of significance. Findings from the analysis revealed that the services of microfinance banks reduce the level of poverty in the state. The result also showed that the CBN provides a conducive and enabling environment for the growth and sustainability of micro finance banks. Following from the findings of this study the researcher recommended that the microcredit institutions should increase the credit facilities to the customers at a low rate of interest to promote economic activities so as to make greater impact on the poverty reduction of people of Ondo State.

Unveiling the nexus between solar energy adoption and crop farmer income: evidence from Pakistan

Worldwide, the continuous advancement of off-grid solar photovoltaic irrigation seeks to improve water access, increase food production, and reduce carbon emissions and energy costs associated with fuel usage. Consequently, this enhances human resilience to climate change and contributes to the improvement of farmers’ income. This study investigates the influence of solar energy adoption on farmers’ income, drawing insights from 1,080 growers in Pakistan. It uses the logit model and propensity score matching (PSM) to address bias. Factors influencing income, including gender, education, decision-making autonomy, farm size, extension services, cooperative associations, access to credit, risk perception, market distance, and tube well availability, are identified. Findings reveal a positive correlation between solar energy adoption and increased crop farmer income. PSM analysis validates this, emphasizing the need for government and agricultural extension interventions to enhance financial accessibility for farmers facing mobility challenges. This includes subsidies for technology adoption and knowledge dissemination about digital technology. The study advocates for an accelerated adoption of solar energy to foster agricultural development in Pakistan. In resource-poor nations like Pakistan, government subsidies are crucial to offset technology costs for citizens facing challenges in affording green energy. Addressing Pakistan’s energy crisis through promoting solar energy for irrigation can amplify farmers’ income. It is imperative to promote access to this technology, particularly for water pumping, through subsidies and readily available credit facilities, given the resource limitations and small landholdings of many farmers in Pakistan.

Cost and returns analysis of upland and lowland rice production among farmers in North Central Nigeria

Sustainability of the rice production and farmers’ income in Nigeria raises a serious concern due to the rising costs of production inputs and other factors beyond farmers’ control. As a result, the study compared the cost and returns of rice production in North central, Nigeria. A multistage sampling technique was used to select 387 rice farmers in the study area. Descriptive statistics, gross margin analysis and seeming unrelated regression were used to analyze the dataset collected. The findings revealed that most of the rice farmers were male, averagely young and have at least 9 family members in their respectively households. Results from Kwara State showed that total cost is higher among the upland rice farmers compared to their lowland counterparts, but reverse was the case in term of net profit, as this favoured the lowland rice farmers. For Niger State and pooled data, the lowland rice farmers had higher net profit than the upland rice farmers. Seemingly unrelated regression estimates indicated that costs associated with fertilizer, herbicide, seed, pesticide and labour used were significant and influencing factors affecting the revenue of rice farmers in the study area. While inaccessibility to cheap farm inputs was the major constraint affecting the rice farmers, other challenges include lack of storage, inadequate rainfall and inadequate credit facilities. The study recommended seamless access to improved rice varieties by the farmers as this can scale up adoption of improved technologies, boost production and ultimately the net revenue of rice farmers. Farmers are also advised to join and/or form a registered occupational groups through which credit facilities can easily be accessed, to expand the farming operations because of the positive and complementary role of social group and access to credit.

Exploring the Investment Behaviour of Petty Traders in Sunyani Municipality

Purpose: The primary goals of the study are to assess the level of awareness among small merchants in Sunyani Municipality regarding investment prospects, the sources of investment information, and the impact of demographic characteristics.
 Methodology: Questionnaires were employed in gathering data for the study, which was based on the quantitative research approach. Using Slovin's sample size computation, a sample size of 396 respondents was selected for the investigation.
 Findings: The results revealed that the majority of small traders were aware of prospective investment alternatives such as real estate, government bonds, bank deposits, life insurance, mutual funds, and stocks and shares. It was discovered that the traders had access to two information sources: the formal and informal sectors. The survey discovered that friends and family serve as the key informal sources of information. Regarding the formal sector, it is disclosed that radio and television served as their sources of investment-related information. Also, the degree of awareness regarding investment opportunities was influenced by gender, age, and household size. The findings indicate that among the investment avenues available to traders, gold and other minerals are not well-known by traders.
 Unique contributor to theory, policy and practice: Therefore, it is recommended that programs and talk shows are organized for people to be aware of these avenues. Policymakers should prioritize programs focused on enhancing the financial inclusion of petty traders by improving the accessibility of formal financial services such as savings accounts, credit facilities, and insurance products. The research findings could potentially aid in improving financial inclusion for small-scale traders, informing local government policies that support them, providing valuable market intelligence for businesses targeting this demographic, and contributing to academic knowledge in the fields of economics, finance, and development studies.

BANKING SECTOR EFFORTS TO CONTAINMENT/ DAMAGE LIMITATION OF COVID-19 CRISIS AS A PREDICTIVE FACTOR IN THE ABILITY TO RECOVERY OF SMES IN JORDANIAN

Objective: The research aims to identify the efforts made by the banking sector to contain the damages caused by the COVID-19 in all its aspects (situation assessment and analysis, and crisis intervention) from the banking sector employees’ perspective. The research also aims to identify the role of the banking sector's efforts in containing the COVID-19 crisis damages on predicting the ability of Jordanian SMEs to recover their activity.
 
 Methodology: The research population consisted of two sub-populations; the first consists a cluster sample was taken from Jordanian banks branch managers, all employees in the risk departments, and employees responsible for credit operations in (Bank of Jordan and the Islamic International Arab Bank), The second subpopulation consists of all SMEs’ owners, 24,000 enterprises in the Northern, Central, and Southern regions of Jordan.
 
 Findings: The study found that there is a positive and statistically significant impact of the banking sector's efforts to contain COVID-19 crisis damage in its dimensions (efforts to assess and analyze the situation and efforts to intervene in the crisis) on the ability of SMEs to recover their activity. The results showed that SMEs suffer from an unprecedented shock and depression in the absence of financial assistance and facilities from the banking sector.
 
 Conclusion: The responses showed (73.33%) of project owners indicated that banks and lenders did not provide any credit facilities.

Credit Scoring Modelling For Corporate Banking Institutions

This research aims to build a credit scoring modeling simulation of bank corporate loans. The credit scoring model is used in assessing creditworthiness in credit decisions. This model determines whether or not a company is eligible for the corporate credit facility it proposes. Observations were made of 100 companies included in the list of Kompas100 Index formers on the Indonesia Stock Exchange (IDX) that have the potential to apply for loans/credits to Bank Financial Institutions (IKB) in optimizing the corporate capital structure through bank debt facilities in the period 2022. Analysis was conducted on five financial aspects consisting of 14 research variables, including (i) liquidity aspects, including current ratio and quick ratio variables; (ii) solvency aspects, including debt asset ratio and equity ratio variables; (iii) profitability aspects including return on net assets, operating profit ratio, price to earnings ratio variables, (iv) activity aspects including total asset turnover, accounts receivable turnover, inventory turnover, current assets turnover, and (v) growth aspects including operating income growth rate, total assets growth rate, and operating profit growth rate variables. The analysis tool uses Logistic Regression through an assessment conducted on the company's credit rating as a proxy for the dependent variable, worth one if the credit application is feasible and worth 0 if the credit application is not feasible with a cut-off point of 0.5. The results show that credit scoring modeling for corporate credit is significantly formed from liquidity (CR) and solvency (DER) aspects. Out of 61 companies classified as not eligible for credit facilities, 58 companies were classified correctly, and out of 39 companies classified as eligible, 29 companies were classified correctly. The overall percentage shows 68.0, meaning that the logistic regression model has an accuracy of 68%.

PENGARUH KREATIVITAS DAN MODAL USAHA TERHADAP KEBERLANGSUNGAN UMK DI SENTRA KULINER FOOD STREET SEMOLOWARU (JALUR GAZA) SURABAYA

Sentra Kuliner Food Street Semolowaru (Jalur Gaza) Surabaya is one of the Micro Small Enterprises in Surabaya. To maintain business continuity, business actors need creativity and sufficient capital to support business continuity. Creativity and Business Capital play an important role in a business. creativity is an effort to produce products to add high value to a business. on the other hand, capital is needed to support all business activities. with sufficient and adequate capital, of course, business actors do not experience difficulties in dealing with financial problems, so that the business can run well to achieve its business goals. In this study, researchers tried to find out the effect of two independent variables, namely Creativity and Business Capital on the dependent variable, namely Business Sustainability. with the object of research at Sentra Kuliner Food Street Semolowaru (Jalur Gaza) Surabaya. The research method used in this research is quantitative research with a causal associative type of research. In collecting data, researchers distributed questionnaires directly and the technique used was a non-probability sampling technique with the type of sampling Saturated (census). The number of respondents is all business people in the Sentra Kuliner Food Street Semolowaru (Jalur Gaza) Surabaya, totaling 50 respondents. The results of this study prove that creativity and business capital have a significant effect on business continuity at the Sentra Kuliner Food Street Semolowaru (Jalur Gaza) Surabaya. Based on the results of this study, it can be suggested for business actors in the Sentra Kuliner Food Street Semolowaru (Jalur Gaza) Surabaya related to creativity is to vary the new menu in accordance with consumer interests that are always changing. While the suggestion regarding business capital is that business actors can take advantage of low-interest credit facilities offered by the government for UMKM.

Unveiling the Economic Potential of Smallholder Pepper Production in the Kumbungu District of Northern Ghana

This study examines the economic benefits and constraints associated with smallholder pepper production in the Kumbungu District of Northern Ghana. Using a multistage sampling method and semi-structured questionnaire, data were gathered from 200 pepper producers from various communities within the district. Gross Margin analysis, descriptive statistics and Kendall’s Concordance method were employed to analyze the data. The results revealed that male farmers dominated with 88% whiles the remaining 12% were women, the mean age of the respondent was 34.21. Majority of the respondents were married (72.5%) while the remaining were single (27.5%) with no divorcees or widows. 85.5% cultivate pepper on farm size between 1.1 to 2.0 hectares with relatively highest mean productivity. In addition, pepper production in the study area is profitable due to GH₵1.98 return for every GH₵1 invested. Major factors identified and ranked as the main constraints in order of importance were; Insufficient working capital, High cost of production inputs, Low level of government support, Inadequate storage facilities, Perishable nature of pepper, Poor mode of transportation, long distance to market, difficulty in getting land for production and insufficient knowledge in pepper production. Therefore, NGOs and Financial institutions who have interest in agriculture should offer credit facilities to pepper farmers for expanding production. The provision of incentive in the form of subsidy, cost-sharing, price control among others should be instituted by the Government, MOFA and Non-Governmental Organization to aid in the expansion of pepper production in the study area.

Energy efficiency investment in a developing economy: financial development and debt status implication

PurposeThis study aims to assess financial development and debt status impact on energy efficiency in Nigeria as a developing economy.Design/methodology/approachThis study combined the autoregressive distributed lag (ARDL), fully modified ordinary least squares and canonical cointegration regression analytical methods to estimate the parameters for energy efficiency policy recommendations. Secondary data between 1990 and 2020 were used for the analysis.FindingsThe result confirms the long-run nexus between energy efficiency, financial development and total debt stock. Furthermore, the ARDL estimates for this study’s key variables show that financial development promotes energy efficiency in the short run but hinders long-run energy efficiency. Total debt stock limits energy efficiency in Nigeria in short- and long-run periods.Research limitations/implicationsThe limitation of this study is that the scope is limited to Nigeria as a developing economy. The need to support energy efficiency projects is a global call requiring cross-country analysis. Despite this study’s focus on Nigeria, it provides useful insights that can guide energy efficiency policy through the financial sector and debt management.Practical implicationsThe financial sector must ensure the availability of long-term credit facilities to clean energy investors. The government must maintain a sustainable debt profile to pave the way for capital expenditure on clean energy projects that promote energy efficiency.Originality/valueThe environmental consequences of energy intensity are being felt globally, with the developing countries most vulnerable. The cheapest way to curb these consequences is to promote energy efficiency to reduce the disastrous effect. Driving energy efficiency requires investment in energy-efficient technology but the challenge for developing economies, i.e. Nigeria’s funding, remains challenging amid a blotted debt profile. This becomes crucial to investigate how financial sector development and debt management can accelerate energy-efficient investments in Nigeria.