CONTRIBUTION OF THE BANKING INDUSTRY TO THE DEVELOPMENT OF NIGERIA ECONOMY
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ABSTRACT OF THE BANKING INDUSTRY’S CONTRIBUTION TO THE DEVELOPMENT OF THE NIGERIAN ECONOMY
One of the sectors with the greatest regulations is the banking sector. It is also widely acknowledged that having access to financial capital is a requirement for the rapid transformation and expansion of any nation’s economy. As a result, banks play a critical role in the economy by making their vast financial resources available for lending and encouraging development.
The researchers were able to determine the many ways in which the bank has contributed to the nation’s economy through the use of interview and questionnaires given to employees and consumers.
It is well known that banks, particularly the United Bank for Africa (UBA) Nassarawa branch, have significantly contributed to the growth and diversification of the Nigerian economy through their support of the people through capital formation and supply for economic development through the provision of audit for both small and large scale industries through accepting deposits, provision of Ioan and incentive to agriculture, and mortgage loan for shelter.
1.1 BACKGROUND OF THE STUDY, CHAPTER ONE OF THE BANKING INDUSTRY’S CONTRIBUTION TO THE DEVELOPMENT OF NIGERIA’S ECONOMY
The growth of Nigeria’s economy is greatly influenced by the banking sector there.
Abdullah (2006) asserts that the banking sector, in particular, contributes significantly to the growth of Nigeria’s economy by encouraging savings and directing them towards investment.
The economy produces more goods and services overall, especially in the real sector, which boosts job levels and increases national output.
Section 61 of the BOFIA states that a sector with a current licence to operate a banking system is referred to as a bank. Receiving deposits on current accounts, savings accounts, or other comparable accounts;
paying or collecting customer checks; and any other activity that the governor may designate as a banking activity and publish in the gazette.
Only when the financial sector in Nigeria is operating efficiently does it play a substantial and advantageous role.
According to Beatrice (2009), it is widely acknowledged that having access to capital is necessary for the quick development and transformation of any economic growth.
As a result, banks play a critical role in the economy’s development by making large amounts of capital available for financial activities and encouraging development.
There have been numerous studies on the banking industry’s contributions, but the banking industry’s contributions to the development of the Nigerian economy have not received adequate research coverage.
As a result, it is necessary to examine the banking industry’s contributions to the development of the Nigerian economy. The research is anticipated to close any gaps and provide a clear understanding of the banking industry’s contributions.
1.2 STATEMENT OF THE PROBLEM
The banking industry has helped the Nigerian economy grow, but it has also faced many challenges. The banking sector has seen some distress phenomena,
which has sent a bad signal to some sectors of the economy and affected the level of activity in the banking sector. In these circumstances, many businesses are closing their doors, and life generally gets difficult for those in the sector.
1.3 OBJECTIVES OF THE STUDY
The study’s objective is to evaluate the role and effects of the banking sector on the development of the Nigerian economy (UBA) PLC, in Nassarawa state.
The following goals help to reach the aforementioned goal.
To assess the numerous services provided by the banking sector, in particular UBA Plc.
To investigate the role played by the banking sector in the growth of the Nigerian economy.
To investigate the role that United Bank for Africa (UBA) Plc has played in the growth of the Nigerian economy.
1.4 SIGNIFICANCE OF THE STUDY
The research work will help the apex body and banking industry operators keep track of their resources in order to boost the wealth of their stake holders.
In order to capitalise on the banking sector’s good contributions, the study will also give the government and banks the tools they need to make the necessary corrections and turn around negative trends.
1.5 RESEARCH HYPOTHESIS
H0 – The contribution of the banking sector to the expansion of the Nigerian economy is not significantly correlated.
H1: The banking sector’s contribution to the growth of the Nigerian economy is significantly correlated.
1.6 SCOPE OF THE STUDY
The research study will look at the function of banks with a focus on United Bank of Africa (UBA) Plc. Since there are many different aspects to the banking industry in Nigeria, it will take some time to discuss all of its contributions to the growth of the Nigerian economy.
1,7 LIMITATIONS OF THE STUDY
Poor answers from the respondents — The majority of the respondents were unaware of the goal of the study and so were reluctant to provide certain crucial information.
Time aspect – Having to cover the United Bank for Africa (UBA) Plc in order to provide the questioner plenty of time, this is one of the researcher’s biggest challenges.
Another difficulty the research has is funding, as it is necessary to fund all of the subject areas.
1.8 OPERATIONAL DEFINITION OF TERMS
Cheques
Cheque is a written, unconditional order that must be signed by the person providing it to a banker, requiring the banker to pay the specified amount of money to the designated person or to the bearer upon demand.
Exchange bills
Unconditional written orders must be given unconditionally and be signed by the person providing them. They must require the recipient to pay a specific amount of money to a designated party or to the bearer on demand, at a set date in the future, or both.
draught from a bank
In circumstances when the same bank drawer and payee are involved, this takes the form of an order sent by the banker to itself or one of its branches to pay the payee the amount mentioned therein; these draughts are not bills of exchange.
Note of Promissory
is an unqualified written promise made by one person to another, signed by the creator, promising to pay the bearer a specific amount of money on demand or at a set or foreseeable future period.
Treasury notes
Treasury bills are short-term loans to the government that must be repaid 90 days after being issued. They are typically issued for a certain amount by the central bank of Nigeria acting as the government’s representative.
Loan
These are given for a longer period of time and typically for a specific purpose that is disclosed to the bank. Personal customers typically use these to purchase consumer goods like cars, boats, electrical goods, etc.,
while business customers typically use them to buy machinery, building equipment, and other items that are referred to as investment goods.
Overdraft
Both personal and commercial customers can use this option to draw checks on their accounts for amounts greater than those already credited to their current accounts.
Bonds with a bearer
These are documents that a company issues acknowledging its debt to the bearer or holder. They typically involve a long-term loan to the company at a fixed rate of interest and are secured by a floating charge on the assets of the company,
which allows the holder of the debenture to sell the asset and receive the proceeds if the company fails to make the required interest payments or repayment.
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