AN EXAMINATION OF THE ROLE COOPERATIVE THRIFT AND CREDIT SOCIETIES TO THE DEVELOPMENT OF URBAN AREA

CHAPTER ONE

1.0 INTRODUCTION

1.1 BACKGROUND OF THE STUDY

In any economy, one or more sections serves the prime movers drilling the rest of the economy. Agriculture until recently has been the prime mover of Nigeria’s economy. The last fifteen years witnessed successive governments in Nigeria’s taking several steps to boost agricultural production in the country.

Most notable among these efforts were the “National Accelerated Food Production Programme” ( NAFPP) which was launched in 1973. Operation feed the nation (OFN) of 1976 and the Green Revolution Programme (GRP) that was launched in 1980 (IJERE. M. O 1975). Special projects were also embarked upon to enhance agriculture such as Agricultural Development Authorities, River Basin and Rural Development Authorities, to mention just a few. Provision of fertilizer, improved seeding to farmers, mass enlightenment campaigns. Introduction of technology packages were also some of the attempts made to raising agricultural production.

In spite of all these, agricultural production in Nigeria is far from the target. Productivity has declined to the extent that the country had to resort to importing agricultural products including food items, some of which were luthen to known to have been exported. This unsavory situation has led concerned authorities to examine closely the problems confronting higher agricultural productivity. One of the major constraints identified is inadequate capital and credit facilities to the farmers. Others are poor transportation, inadequate flow of funds into agriculture has been identified as a critical factor in decelerating increased food production in Nigeria (Adeyeye; 1978). Credit Societies

Making funds available to farmers through agricultural credit facilities is importance because it enables them expand the scope of their operation and adopt new production techniques, also it enable them to develop orderly marketing of their product through the adaptation of new techniques for processing and storage as well as generating high bargaining power associated with greater liquidity. Credit Societies

In order to ameliorate this funding problems being encountered by the financial institution in Nigeria to allocate yearly a certain percentage of the total lending to the agricultural sector, this is was hoped, would afford the farmers the capital and production credit needed to boast agriculture. This attempt at sector allocation failed to achieve the intended objective as trading banks were reluctant to lend to agriculturist because of the high default risk resulting from the uncertainty and risk inherit in agricultural production and marketing.

The farmers were also confronted with the inability to provide the needed collateral securities . The farmers inability to provide the needed collateral securities by banks led to the search for co-operative societies. The group can lend to individual member farmers and outsiders today. There are many co-operative thrift and credit societies and this project hereby examines the impact they have made towards the financing or upliftment of agricultural production in Nigeria. Credit Societies