Inflation and Deposit Mobilization in Deposit Money Banks : The Nigerian Perspective

The broad objective of this study is to critically examine inflation rate in Nigeria with the view of ascertaining its effect on the deposit mobilization in Banks. The study which is ex-post facto, relied mostly on secondary data which were collected through the Central Bank of Nigeria (CBN) statistical bulletin, Nigeria interest research library research, textbooks, journal and report from1994-2014.The population for this study included selected numbers of banks i.e. deposit money bank in Nigeria from 1994 –2014.Multiple regression Ordinary Least Square (OLS) statistical tool was applied to establish the like fit to the observed data and the degree of relationship that exist between variables. Findings reveals among others that there exist a significant and negative relationship amongst demand, savings and time deposit with inflation in Nigeria, and that interest rate impacted significantly and positively on saving and time deposit .It is recommended among others evaluation of the marginal increment ofdeposit interest rate for savings and time Deposit through Central Bank of Nigeria Monetary Policy Committee (MPC) at higher rate than inflation as an incentive to attract high deposit mobilization, and encouragement of increased trade activities geared towards increased money supply in the economy