CRITICAL REVIEW OF THE ROLE OF COMMUNITY BANKING IN RURAL DEVELOPMENT

ABSTRACT

This research work scrutinized the roles of community banks in rural development is very essential to complete with other parts of the world. Particularly those from industrial countries who are already in the rural development and have easy access to various type of community bank in rural development. To be able to complete effectively with such rural development, Nigeria community banks must be willing to offer attracter terms. The federal government has and is still working hard to encourage the development of community banking in rural areas. A good step towards this is the promulation of roles of community bank in rural development incentives and miscall on loans provision decree 46, which came up with numerous incentive to community bank in rural development.  More also is the inauguration of community bank in rural development. In a nutshell its pertinent to note that roles of community ban k in rural development is a great important towards economics development in rural areas. Therefore all hands must be on desk to salvage our community from the hindrance or obstacles of community banks, so as to put our economy in to a better position.

CHAPTER ONE

1.1   STATEMENT TO PROBLEM

The bank is structure to accommodate every community member including indulging, organization and non-indigenes. A community bank is a self sustaining financial institution owned and managed by the community or group of people (age grades) in that community for credit worthiness.

I want to investigate how for the community banks have played the roles expected of them in rural development these roles include to:-

a) Provide financial and banking services to rural dwellers.

b) To serve as security to the rural dwellers operate equipment leasing facilities, supervises credit schemes for groups

c) Assist clients in marketing agricultural rural industries and other products.

I also want to investigate some of the problems facing these community banks in the performance of the roles:-

a. Reckless lending / spending inability to market banking service

b. Poor capital base has stagnated the progress of many community banks.

c. Staffing

d. Political

1.2   RATIONALE OF STUDY

A student of the nature must be purposive otherwise it will mean that the researcher has labour in vain.  The study, therefore are

1) The rapid development of production activities in the rural areas and hence the development of the economic status of both the rural people and the rural areas.

2) The promotion of rural development by providing financial and banking services to communities madunately supplied with such services.

3)  The fostering of community ownership and use of economic asset. Etc.

4) The inculcation of discipline banking habits among the masses of low income workers in Nigeria, especially thodre in the rural areas.

5) The emergence of an effective and integrated national financial system that responds to the needs of the whole economy, especially at grassroots community levels.

1.3   SIGNIFICANCE OF THE STUDY

This study will provide an opportunity for any person who may read it to appreciate what role community banks mean. There is no gain saying that it will proffer an immense assistance to potential role community bank through an expected problem, that may seem a hindrance. And those that are managing the roles of community, offer possible solutions to some of the problem they encounter while performing their duties. The study therefore provide useful guide to future researchers who may want to embark on the study.

1.4   DEFINITION OF TERMS

COMMUNITY: This means group of people living together in a geographical area, or united by shared interest, religion, nationality, language and culture.

BANKING: This is the act of acquiring form account holders, valuables for sate keeping payment of cash according to the mandate of the customers and provision of credit facilities to desire and qualified customers and other financial services, by financial institution called bank.

RURAL: This is the country side of country. It is the opposite of the urban centers.

DEVELOPMENT: Development is a continuous process of positive change in the quantity and span of life of a person group of person and a community. In this respect other forms of development are taken as contributory factor economic, social political, technology and cultural development are inter-related and inter dependent.

SELF-HELP: This means that people should produce whatever they need them selves without depending on outside help.

SMALL SCALE ENTERPRISE: central banks circular number 28 on monetary policy in 1994 section 12 designed small scale enterprises as an enterprise whose total cost excluding cost of fund but including working capital is above one million naira (N1m) but does not exceed ten million (N10m).

LOAN: This means a customer in the bank withdrawing more than the amount deposited on a bank. The bank customer is of  respectable character.