CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND TO THE STUDY
The rural areas, almost 75% of Nigerians contribute substantially about 92% of the nations agricultural products, knowing well of this visible and immeasurable contribution, the rural dwellers who are predominantly farmers are denied of any government support in terms of increased institutionalization of agricultural credit, concessionary interest rate policy, flexible condition on borrowing incentive to farmers, decentralization of institutional agencies, improved credit system, great reliability in supply of agricultural credit, negative action against defaulting credit institution.
From the above, this research will be carried out under an investigative analysis on what reform the federal government is enunciating the community banking programmes in the rural community which will be followed by an identification of all allied strategies and their relevance to the revamping of the dwindled rural economy in the face of the deregulation of the Nigerian economy. It is necessary to study how the non institutional financial sector complements the current development strategies. This study also intend to evaluate the challenges inherent in the operations of the community banking.
1.2 STATEMENT OF PROBLEMS
Despite the recognition given to grass root operators by the government through the establishment of the community banking programmes it appears that such gestures is yet to be accepted by the rural operators. And on the other hand, informal financial sector has not received any support even when it clamors for such obviously because of the emergence of the problems ridden development strategies or programmes. Some people have jointly expressed their view over the government reckless neglect of the informal financial institution. The institutions are consistently starved of funds and it limits the scale of economic activities. It can support and it is equally believed that inadequate liquidity and difficulty in identifying the structure of interest rates are some of the problems facing the institution.
Gain (1991) holds that the establishment of development programmes aimed at rejuvenating from it limbo, the rural sectors by the stampeded Babangida’s administration is nothing but a ruse to hood work and mislead the innocent, the aggrieved and the oppressed. According to Solarin, community banking is a window dressing that lack substance. The he seriously believed that the programmes were more conceptual expression existing only in the contemplation of government imagination.