ROLE OF NIGERIA AGRICULTURAL AND COOPERATIVE BANK IN THE DEVELOPMENT OF AGRICULTURAL IN NIGERIA
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ROLE OF NIGERIA AGRICULTURAL AND COOPERATIVE BANK IN THE DEVELOPMENT OF AGRICULTURAL IN NIGERIA
ABSTRACT
The Nigeria agricultural and cooperative bank (NAXV) was created in 1973 to help in the growth of the countries economy through giving agricultural aids as well as supporting the farmers and cooperative organisations.
Initially, at the bank’s formation, our resources were primarily comprised of federal government subscribed equity capital and statutory allocation from the federal government.
However, the resources available presently are government loans and advances, loans from the International Bank for Reconstruction and Development (IBRD),
school falls from the agricultural credits guarantee system, and loans from the domestic money market such as insurance companies and other banking sectors.
One of the primary issues confronting Nigeria’s agricultural and cooperative bank is a shortage of capital. Financing cooperative organisations with internally produced cash has not been sufficient because individual members of these societies (the majority of whom live in rural areas) are few and impoverished. As a result, the society requires outside funding to complete its project.
The necessity for finance for some of these agricultural projects led to the foundation of the Nigeria Agricultural Bank (NAB) in 1973, which represented a dynamic change in offering credit facilities to farmers after its inception.
INTRODUCTION TO CHAPTER ONE
1.1 STATEMENT OF THE PROBLEM
The Nigeria Agricultural and Cooperative Bank (NACB) was founded in 1973 to aid in the development of the country’s economy by providing agricultural aid, finance, and assistance to formers and cooperative societies.
The need for financing for some of these agricultural projects led to the establishment of the Nigeria agricultural and cooperative bank (WAB) in 1973,
which marked a dynamic change in providing credit faculties to farmers as well as financing for industrial processing and marketing of agricultural products. They also function as a national bank in agricultural development in Nigeria in order to improve the Nigerian economy.
The bank was created specifically for the aim of providing credit to the agricultural sector. The loan is made available to customers in order for them to purchase excess crops during harvesting seasons. This practise reduced waste and provided an incentive for farmers to grow more crops.
The loan term ranges between a and 21 months. The Nigeria agricultural cooperative bank was founded to provide financial and logistical help to the agricultural industry, however they were unable to accomplish their goal.
The goal of the research
v To assess the WACB’s role in the growth of Nigeria’s agricultural sector and how the bank has improved the financial condition of small and medium-sized farmers.
v The bank’s sources are supplied by the following sources.
v Federal government equity capital
v Statutory government financial allocation
v Government-backed loans
v Financial market on a global scale
Short falls from commercial and merchant banks are passed on to WACB as loans by the central bank.
1.2 THE RATIONALE FOR THE STUDY
v Animal feed production: Agriculture produces animal feed, which is then converted into animal protein for human consumption.
v Foreign exchange earnings: It assists agricultural products in becoming important export products in many nations, particularly African industrialised countries.
v It helps to give revenue for farmers and anyone who are involved in agriculture in some way.
v Job creation: it helps to create jobs for millions of people all over the world while also increasing the percentage of people who work in agriculture.
v It also supplies raw materials to our diverse industries.
1.3 SIGNIFICANCE OF THE STUDY
The people who will profit from this work are other farmers and exporters, because WACB is out to help people in the agriculture business expand their businesses and our country.
Wacb is intended to give technical advise to industrialists, for example, they help new industrialists learn about possible raw material sources and markets for finished products.
Again, they promote Nigerian exports by providing loans to viable exporting firms in need of such help. They also provide prospective farmers and traders with long and medium-term loans. Farmers that are substance will now expand to commercial farmers with the assistance of NACB.
1.4 DEFINITION OF TERMS
Short-term loan: an advance or capital issued to a customer by a bank that is normally required for return between one month to one year.
Collateral is a type of security used to guarantee loans and credit.
Farmers on a small and medium scale: These are farmers who cannot function on a huge scale.
Scale production: they are primarily subsistence farmers who are unfamiliar with advanced farming machinery.
Capital is defined as money and other types of productive assets.
Medium-term loan: a loan between short and long terms that is often required for repayment within three to five years.
Long-term loan: a loan with a repayment period of five to thirty years.
On Lending: This is a type of indirect lending to prospective borrowers.
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