Contribution Of Banking Sector To Agriculture Growth

INTRODUCTION
Background of the Study
Every nation has hoped to develop. Its Urban and rural areas policies are formulated to ensure the achievement of the overall development of the nation. For instance, in Nigeria reasonable number live in the rural areas and so the issue of developing the rural people in these areas in question are predominant farmer who produce the highest percentage of the nation’s food and yet there is no significant development of the rural areas.
There are no good roads, electricity clean pipe borne water supply and other social amenities. In recognition of these problems providing for the development of these areas. However, rural development has been given various intervention by various Nigeria governments. During colonial administration, the altempt in developing rural areas were limited to these that benefits the colonial administration thereby meveing them up the transport and communication system to entrance easier exploitation and movement of natural resource from the rural areas to the urban areas. The administration neglect the condition of the rural people who produce the bulk of the resources (Agricultural Products).
The NACB (Nigerian Agricultural and Co-operative Bank) was established on the year 1972, it is mainly to finance agricultural development producers and allied industries in this operations, the banks usually interacts with sleeve ministries of agriculture. It also sources of funds from government subventions credit short falls or agricultural loans by commercial and merchant banks.
Through the CBN and loans from international finance institution such as the international bank for reconstruction and development (IBRD) aims to reduce poverty in middle-income and credit worthy poorer countries by promoting sustainable development through loans guarantees, risk management products, and analytical and advisory services.
These was established in 1944 as the original institution of the world Bank Group, IBRD is structured like a cooperative that is owned and operated for the benefit of its 187 member countries which Nigeria is included in the year 1961. At its Annual meeting in September 2006, the world Bank with the encouragement of its shareholder government committed to make further improvement to the services it provides its member.
Since independence, efforts have been made to correct this neglect. The various natural development plans formulated that development of both the urban and rural areas will establish solid base for long run economic and social development of the counting. However, the development of rural areas was interpreted to the main development of Agriculture. It was that since the major occupation of the rural people is found to be Agriculture, so the government should develop the Agriculture as the case may be.
Consequently such crucial problems of rural development such as good means of transportation, good means of communication availability of vehicles to move rural people and their goods to urban areas banking services were not provided in the rural areas, recognizing the importance of banking services in the rural areas, the government in 1977.
a. Cultivate banking habit among the rural dwellers.
b. Mobilize savings from rural areas for the purpose of channeling some to profitable ventures.
c. Create credit by way of equity and loan for small scale industries.
d. Develop agriculture and agroculed industries in rural areas with a view to achieving the natural objective of the self sufficiency in food production. A strong and efficient agricultural sector has the potential to enable over so percent of the food of the country.
e. Reduce the uncomfortabilites of the young man and woman from the rural areas to the urban areas as regards transportations, mass production of agricultural product.
The Government’s effort on ensuring the development of the rural areas did not end in the establishment of recognizes that agricultural development has not necessarily mean rural development and has therefore recently formulated a national rural development strategy blems and the enhancement of the quality life for rural dwellers.
To implement this, the directorate of food and rural infrastructures (DFRRI) was established in 1986. it can be seen from the various efforts of the Government towards development of rural areas of the nation. A part from the infrastructural facilities, the banking services are needed in order to complete areas which has failed to yield positive results because of many factors of which finance was the most important.

Statement of the Problems
People in the rural areas engage mostly in substantial farming thereby needing Government interest over the growth of Agricultural sector in the rural areas. Contributions of banking sector lending towards rural development have been a subject of debate amongst prominent scholars. One school of thought was quoted as saying that strieght lending policies coupled with high lending requirements of banking sector was the major difficulties encountered in developing the rural areas. Okorie and Miller 2005 further argued that the impact of banking sector lending to rural development will remain a mirage until the bank address the minds of the rural dwellers towards the major problems of the rural populace.
Another school of thought has it that rural development is possible only through the banking sector participation more especially in lending to the rural populace.
However, certain problems of banking sector in rural lending may start to enlarge as we probe assertion of each school of thought. Firstly, banking sector lending intention to the rural as often do not materialized for reasons ranging from unavailability of collateral, the inability of the borrowers to pay back.
Secondly, the rural banking services of the banking sector are only skeletal due to the absence of good roads and pipe borne water e.t.c.
Finally, the rural banking habit of the services of the banking sector and that could be derived from them.

Significance of Study
One of the beneficiaries of this study is the farmers. This study will help to educate them on what they should know about bank loan and how they can acquire loan in other to enhance their agricultural products.
This study will also go further to increase the knowledge of the students which might be of a great help to them at present and in the future. The bank in the other hand will benefit in the interest which they will be getting from the farmers that have been enlightened through this study to make use of bank loan. Through this study the ministry of agriculture will also get to know the difficulties of the rural dwelling farmers and help them in handling the difficulties.

Scope and the Limitation of the Study
This study covers the entire contributions of banking sector lending in rural development with the case study of First Bank of Nigeria Plc, Enugu State and the extent of the availability and the inability to repay have contributed to the levels of lending.

Purpose of the study
The purpose of this study is to;
1. Know the requirement for bank lending to the rural development as regards agriculture.
2. Know if the rural dwelling farmers develop interest in collecting loan from the bank.
3. Know if the rural dwelling farmers pay back the loan collected from the bank.
4. Know if the rural dwelling farmers agree with collateral as one of the requirements for bank lending.

Research Question
1. What are the any requirements of bank lending to the rural development as regards Agriculture?
2. Do rural dwelling farmers develop interest in collecting loan from the bank as it is believed that the occupation of the rural dwellers is agriculture?
3. Do rural dwelling farmers pay bank the loan collected from the bank?
4. Do rural dwelling farmer agree with the provision of collateral as