Effect of technology adoption on market innovation in Nigerian fintech industry

Abstract

Rapid technological evolution and competitive pressures in Nigeria’s fintech sector have raised concerns about how effectively firms leverage technology to drive innovation, prompting investigation into key technological factors influencing market innovation. This study examines the effect of technology adoption on market innovation in the Nigerian fintech industry. Specifically, it evaluates the extent to which relative advantage, technology utilisation, and technology competence drive market innovation. A total of 202 questionnaires were administered to CBN-licensed fintech firms. Pearson correlation analysis showed statistically significant positive correlations between relative advantage, technology utilisation, and technology competence with market innovation, suggesting interdependencies among variables. The regression model yielded an R-value of 0.157 and R squared of 0.123, indicating that 12.3% of the variation in market innovation is explained by the predictors. An adjusted R-squared of 0.110 reflects a slight reduction in explanatory power. The model demonstrated statistical significance, confirming the collective influence of relative advantage, technology utilisation, and technology competence on market innovation. Coefficient analysis showed relative advantage and technology utilisation had significant positive effects on market innovation, while technology competence showed marginal significance. These findings highlight the critical role of relative advantage and technology utilisation in driving innovation within Nigeria’s fintech sector. Firms adopting advanced technology are more likely to enhance operations, optimize services, and expand customer reach. Despite the model's modest explanatory power, the study underscores the need to strengthen technology competence and regulatory adaptability. Future research should consider additional factors affecting market innovation.