Digital Lending and Financial Literacy: Examining the Awareness and Attitudes of Nigerian Borrowers

Abstract

The rapid evolution of digital lending platforms has reshaped Nigeria’s financial landscape, providing greater access to credit for both banked and unbanked populations. This study examines the relationship between financial literacy, awareness, and attitudes of Nigerian borrowers toward digital lending platforms. Using a quantitative, descriptive survey design, data were collected from 120 respondents in Ibadan, Oyo State, who had previously accessed loans through platforms such as Carbon, Branch, FairMoney, and PalmCredit. The results indicate that financial literacy significantly influences borrowers’ awareness and attitudes toward digital lending. Regression analysis revealed that education and income positively affect financial literacy, while age exhibits a negative influence; gender was found to be statistically insignificant. Correlation analysis showed a strong positive relationship between financial literacy, awareness, and borrower attitudes, with awareness serving as a mediating factor. These findings suggest that borrowers with higher financial literacy are more informed and exhibit more positive attitudes toward digital lending, thereby reducing the likelihood of over-indebtedness. Therefore, strengthening financial literacy through targeted education and regulatory policies is essential for promoting responsible borrowing behavior and achieving sustainable digital financial inclusion in Nigeria.