Background of the Study
Financial transparency is a cornerstone of trust between investors and startups, particularly in the fintech sector, which relies heavily on external funding to drive innovation and growth. Fintech startups in Jigawa State are no exception, as they require investor confidence to sustain operations and scale (Yusuf & Bello, 2023).
Transparency entails clear, accurate, and timely financial reporting, enabling investors to assess the viability and risks associated with their investments. In recent years, increased scrutiny of fintech firms has highlighted the importance of financial transparency as a determinant of investor decisions (Abdullahi et al., 2024). This study examines how financial transparency influences investor decision-making in fintech startups in Jigawa State.
Statement of the Problem
Despite the rapid growth of fintech in Nigeria, including Jigawa State, many startups face challenges in attracting and retaining investors. A lack of financial transparency often raises concerns about governance, profitability, and risk management, deterring potential investors (Ahmed & Suleiman, 2023).
While studies have explored transparency in larger financial institutions, limited attention has been given to its impact on fintech startups in emerging markets. This study seeks to address this gap by investigating how financial transparency affects investor decisions in Jigawa’s fintech ecosystem.
Objectives of the Study
To analyze the role of financial transparency in shaping investor decisions in fintech startups in Jigawa State.
To identify key transparency practices that enhance investor confidence.
To propose strategies for improving financial transparency in fintech startups.
Research Questions
How does financial transparency influence investor decisions in fintech startups in Jigawa State?
What transparency practices enhance investor confidence in fintech startups?
What strategies can improve financial transparency in fintech startups?
Research Hypotheses
Financial transparency does not significantly influence investor decisions in fintech startups in Jigawa State.
Transparency practices do not significantly enhance investor confidence in fintech startups.
Strategies to improve financial transparency do not significantly impact investor decisions.
Scope and Limitations of the Study
The study focuses on fintech startups operating in Jigawa State, analyzing financial transparency and investor decisions from 2015 to 2025. Limitations include limited access to financial data and reliance on self-reported investor surveys.
Definitions of Terms
Financial Transparency: Open and accurate disclosure of financial information to stakeholders.
Investor Decisions: Choices made by individuals or entities regarding financial investments.
Fintech Startups: Emerging businesses leveraging technology to provide financial services.
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