Abstract

This study investigates the role of financial sector reforms on macroeconomic performance in Nigeria from 1990 to 2024. The research focuses on four key components of financial reforms: banking sector reforms, stock market development, financial inclusion, and market interest rate reforms. Using time series data from the Central Bank of Nigeria (CBN) and World Bank Development Indicators. The study employed the Autoregressive Distributed Lag (ARDL) model to examine both short-run and long-run relationships. The ARDL bounds test confirms the existence of a long-run co-integrating relationship among the variables. Results indicate that banking sector reforms have a significant positive impact on GDP growth, highlighting the importance of a sound and well capitalized banking system in promoting economic activity. In contrast, financial inclusion shows a negative but significant effect, suggesting that access to financial services alone may not translate into productive economic outcomes without complementary policies. Stock market development and market interest rate reforms are found to be statistically insignificant, reflecting structural and institutional constraints in the Nigerian financial system. The study concludes that while financial sector reforms are critical for economic growth, their effectiveness depends on efficient implementation, institutional support, and complementary measures to ensure financial access translates into real economic gains. Policy recommendations include strengthening banking reforms, improving financial literacy, enhancing the productive use of financial services, and supporting structural reforms to sustain long-term growth.