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We examine the role of household financial access in determining the extent of risksharing in Nigeria using household-level panel data. We estimate changes in the response of consumption to shocks for households with formal and informal access to finance and those without, both for the country as a whole and for different regions. Our findings suggest that households with financial access who experience an unexpected negative income shock see consumption fall by 15 percentage points less than those without access. This result is mainly driven by households with informal financial access, and by household savings rather than borrowing. Regional variation in risk sharing tends to be significant, suggesting that financial inclusion efforts going forward should have a more regional focus.

Consumption (Economics) --- Financial services industry --- Services, Financial --- Service industries --- Consumer demand --- Consumer spending --- Consumerism --- Spending, Consumer --- Demand (Economic theory) --- Banks and Banking --- Macroeconomics --- Finance: General --- Economic Development: Financial Markets --- Saving and Capital Investment --- Corporate Finance and Governance --- Formal and Informal Sectors --- Shadow Economy --- Institutional Arrangements --- Economywide Country Studies: Africa --- Macroeconomics: Consumption --- Saving --- Wealth --- Urban, Rural, and Regional Economics: Household Analysis: General --- Aggregate Factor Income Distribution --- Banks --- Depository Institutions --- Micro Finance Institutions --- Mortgages --- Financial Markets and the Macroeconomy --- Banking --- Finance --- Consumption --- Household consumption --- Income shocks --- Income --- National accounts --- Financial inclusion --- Financial markets --- Economics --- Banks and banking --- Nigeria