Thesis Abstract

Abstract
Community banking plays a vital role in rural development by providing financial services and promoting economic growth in local communities. This critical review examines the various ways in which community banking contributes to the development of rural areas. The study explores the impact of community banks on access to credit for small businesses and farmers, financial inclusion for underserved populations, and overall economic stability in rural regions. Through a comprehensive analysis of existing literature, this review highlights the importance of community banks in fostering local economic development. Community banks are found to offer personalized services tailored to the needs of rural residents, which may not be readily available from larger financial institutions. This personalized approach helps build trust and strong relationships within the community, leading to increased financial literacy and improved access to financial resources. Furthermore, community banks are shown to play a significant role in supporting small businesses and agriculture in rural areas. By providing loans and financial assistance to local entrepreneurs and farmers, community banks help stimulate economic activity, create jobs, and boost income levels in rural communities. Additionally, community banks often serve as a source of stability during economic downturns, as they are more likely to continue lending to local businesses when larger banks may pull back. In terms of financial inclusion, community banks are crucial in extending banking services to underserved populations in rural areas. These banks often have a better understanding of the needs and challenges faced by marginalized groups such as low-income individuals, minorities, and the elderly. By offering affordable and accessible financial products, community banks help promote financial inclusion and empower underserved populations to participate more fully in the local economy. Overall, this critical review underscores the positive impact of community banking on rural development. By fostering economic growth, supporting small businesses, promoting financial inclusion, and enhancing community resilience, community banks play a vital role in building sustainable and prosperous rural communities. Policymakers, stakeholders, and researchers are encouraged to further explore the potential of community banking as a key driver of rural development and consider ways to strengthen and expand the reach of community banking services in underserved rural areas.

Thesis Overview

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.