Abstract:

The issue of low capital accumulation or savings due to financial shallowness instead of financial deepening is a worrisome situation that needs to be addressed. Data, which are relevant to variables of study like financial deepening and total savings (which was used to capture capital accumulation), and spanning 46 years from 1970 to 2016 were gathered from secondary sources and analyzed using the Auto-Regressive Distribution Lag model. The result showed that capital accumulation has a long-term positive and significant impact on financial deepening. The paper recommends amongst others that banking habits should be encouraged to every Nigerian so as to increase total savings and hence, capital accumulation.