EFFECTIVE ADMINISTRATION OF CREDIT IN CO-OPERATIVE CREDIT ENTERPRISE.
Need help with a related project topic or New topic? Send Us Your Topic
DOWNLOAD THE COMPLETE PROJECT MATERIAL
EFFECTIVE ADMINISTRATION OF CREDIT IN CO-OPERATIVE CREDIT ENTERPRISE.
Chapter one
INTRODUCTION
1.1 Background of the Study
Agricultural credit in Nigeria stretches back to the 1930s, although organised financing to farmers did not begin until 1972, when the Nigerian Agricultural and Cooperative Bank (NACB) was founded.
The bank’s founding was most likely motivated in part by an understanding of the severe drop in agricultural production.
The NACB isn’t the only financial entity that offers agricultural credit. Prior to the founding of the NACB, agricultural credit schemes were operated by several agencies, including the Ministry of Agriculture’s supervised credit scheme, agricultural credit co-operation, co-operative thrift and loan schemes, and farmers multi-purpose co-operatives.
The majority of these institutions were not effective suppliers of solely agricultural lending. There was a lot of evidence that creditors borrowed money for agriculture but used it for other purposes.
Again, finance was frequently granted just to favoured individuals and rarely to actual small-scale farmers. Furthermore, they were unable to meet the collateral and equity contribution requirements, forcing a considerable proportion of farmers to look for alternative sources of credit.
According to Idachaba, citing Cardoso (1987), a survey found that 58% of farming-related borrowings came from family and friends, 24% from private money leaders, 15% from macharts, and only 3% from institutional sources.
However, family and friends charged little to no interest. Credit facilities were organised for Nigeria’s rural farmers. Would lessen reliance on sources other than established banking institutions.
In light of this, the researcher will explore how credit will be properly administered in cooperative firms. This will allow us to identify key credit administration issues and explore solutions to secure the co-operative’s continued survival.
1.2Statement of Problem
Cooperative societies provide credit to their members based on member savings.
They have been observed to be inefficient in the mobilisation and utilisation of credit. Many factors contribute to the poor mobilisation of credit. They are:
– Insufficient funds for loan purpose.
– Inefficient administration of loans
– Faulty loan policies that may place an emphasis on borrowers’ creditworthiness rather than project viability.
– Credit operations are merely monetary activities that lack sufficient organisation and methodical planning.
– A lack of regular monitoring and oversight of loans.
The challenges listed above must be addressed in order for cooperatives to function effectively.
1.3 OBJECTIVE OF STUDY
The position of co-operatives is nothing to write home about; if they continue at this rate, they will fail.
Given the foregoing, solutions must be developed for the following issues:
– As a result, the study’s goal is to identify the numerous societies that exist in the area under investigation.
– To identify the numerous issues that these cooperatives face that prevent them from performing effectively and efficiently as credit agents.
– Finally, give recommendations and suggest plausible solutions to help these cultures overcome their problems.
–
1.4 Significance of the Study
This study will help loan committed managers make decisions on credit policy and credit management by assessing loan applications properly. Credit supervision and project proposal appraisal should be conducted properly.
It will assist management in recognising the need for professional workers, and finally, the study or findings will be of educational value to the various universities, polytechnics, and students of cooperative departments in various schools.
1.5 SCOPE AND LIMITATION.
The researcher will focus this study on the successful administration of credit in co-operative enterprises in Enugu South Local Government Area.
The researcher seeks to learn about the available funding sources for cooperatives as well as the cooperative’s financial problems. The researcher will also look into the credit administration procedure and some of the variables that work against it.
LIMITATION
During the course of this study, the researcher encountered the following issues.
– Finance
– Time
– Lack of data.
1.6 Definition of Terms
For clarity of goal, the eradication of any confusion, and a full grasp of this research. The following definitions of words are necessary.
– Management
Administration, often known as management, is the practice of directing human actions in the creation of goods and services in order to attain a specific goal.
– Business enterprises
This is an economic system in which individuals have the freedom to own wealth and engage in economic activity, either individually or collectively, within the framework of social legislation designed to defend individual interests.
— CREDIT
Credit is the direct or indirect funding of another against future repayment. Direct lending or financing occurs when, for example, a bank gives an overdraft facility to a customer, who subsequently uses it. It is indirect when a trader or producer provides items on loan (David.W. Pearil).
1.7 RESEARCH QUESTION.
Credit is extremely crucial in all commercial activities. As a result, the study focuses on providing money for a relevant solution to the following research topic.
– What is the objective of credit administration in cooperative societies in Enugu South Local Government Area?
– How effective is credit administration for cooperatives in Enugu South L.G.A?
– What problems do co-operative societies have with administering credit, and how do they solve them?
Need help with a related project topic or New topic? Send Us Your Topic