THE EFFECT OF COMMUNITY BANKS IN RURAL DEVELOPMENT (A CASE STUDY OF ULI COMMUNITY BANK ULI)

ABSTRACT: This project work is a study of the impart of Community Banks in Rural Development: case study Uli Community Bank Ltd, Uli. In carrying out the research, questionnaires were used,  which the researcher made available to the manager, staff and customers of Uli Community Bank. Information for this research was collected from primary, secondary and oral interviews. The data were analyzed using tables and evaluation of data using percentages. The study reveals Uli Community Bank has a lot of impact in the development of its local area (Uli,Ihiala LGA,  Anambra State), and these include:  inculcating banking habits on the rural dwellers,  and to generate employment in the areas where it is located; and as well, granting  loans to the rural dwellers; a ready medium for quick cash transfers for people whose relations are abroad and within. The researcher also found out that Uli Community Bank does not only provide financial services to the rural dwellers, but also guarantees employment to the masses in their local and granting loans to the rural dwellers without adhering strictly to the collateral requirements Uli Community Bank even goes the extent of limiting the use of collateral to only making use of a third party qyarabtir.  The researcher also noticed that the main problem facing Uli Community Bank is that it  has a lot to do in the growth of economic activities in the rural areas. The recommendations were made the banks should be adequately funded by the federal government to beef  up their capital base. Since it was established to promote productive activities in her rural area, this will go a long way in helping the bank to meet her enormous demands in development of the rural areas.Government should also allow the community bank to be involved in foreign exchange transactions and also to process her cheques directly with the central bank and not through correspondent commercial banks.  This could be possible only if community bank are allowed to have branches and are accepted no clearing house. Finally, Uli Community Bank should be allowed to establish other branches in her rural areas and beyond.  If all these recommendations are implemented, it will go a very long way to developing the rural community which is among the objectives for establishing community banks.

TABLE OF CONTENTS

CHAPTER ONE

Introduction                                                                            1

Background of the study                                               1

Statement of the problem                                              6

Objective of the study                                                    7

Significance of the study                                                9

Research Questions                                                       10

Scope of the study.                                                        10

CHAPTER TWO

Review of related literature.                                           11

2.1 Historical developments of community banks                  11

Related roles of development institutions and banks       19

The role of central bank of Nigeria in the establishment

of community banks                                                        23

Rural development programmes and community banks 30

CHAPTER THREE

Research methodology                                                   36

Research design                                                             36

Population of the study                                                 36

Sample and sampling techniques                                   36

Methods of Data collection                                            37

Method of Date Analysis.                                              37

CHAPTER FOUR

Data Presentation and analysis.                                     38

CHAPTER FIVE

Discussion of result                                                       49

Summary of findings                                                     49

Conclusions                                                                   51

Recommendations                                                         52

Suggestion for further study                                          53

Limitation of the study.                                                 54

References                                                                      55

Appendix A                                                                   57