THE PROBLEMS FACING THE ESTABLISHMENT OF BANKS IN RURAL AREAS (A CASE STUDY OF SOME SELECTED LOCAL GOVERNMENT AREAS OF ENUGU STATE)

INTRODUCTION 
BACKGROUND OF THE STUDY  Banking transactions in some selected local government in Enugu such as Udi, Ezeagu Udoji is not new to us as we have been practicing this system for over thirty years after independence. However it is on this background that two systems of operations were adopted for effectiveness and efficiency of the product management in various banks. In the past we use to have an orthodox banking process whereby the banker relaxes on this sit waiting for customers to bring business. This type of banker is looked at as somebody with rigid ideas about bankable projects and which in turn retards the smooth flow of banking operations. Another type of banking process adopted as conventional is the unorthodox system whereby the banker is evolved in looking for customers. Because they want to maximize profit, the banks employ all possible marketing promotional strategies in order to survive, hence competitors has come into play and thereby creating innovation and business acumen. Knight Lester B. (1970: 7) status of banking marketing Washington D. C. American Bankers Association states that banks primarily especially commercial banks are engage in business of collection, payment and depository functions as well as credit management.  According to Kotler (1980: 4) stated that the survival of any bank depends on the manner it functions and therefore it has to depend on the market place for its profitability and environments of the economy which it serves. It is worthy to mention that the ability of any business to serve and retain its customers depends mostly on the quality and the effectiveness of the product management it offers. The quality of services provided by the any organisation is better judged in terms of it’s ability to bestow the customer’s with the desired satisfaction. In this regard characteristics such as reliability, standardization, availability and other desired attributes associated with service combine to determine the effectiveness of the product management in the marketing of banks services in the three local government areas.  Martins (1979: 12) confirmed that the image commercial bank has is important because it determines the customers patronage of bank.  According to advertisers watchdog (1983: 7) awareness creation strategy has been limited to advertisement which does no more than informing the customers about the services they offer and the address of their location. All the claims about efficient courteous and speedy services are false and advertising in banking industries can only become a reality when services the bankers render is equated to match the claims they make I the advertisement. According to Azikiwe (1943: 16) expressed his annoyance and disappointment over the treatment meted on him from a bank staff in Lagos. The story is still the same every where even after the days of the white men. Loans are still granted guarding to customers and if granted, it is alleged that the managers demand personal cuts, long queues, man-know-man etc.  Banking habit among the people is still very low in sipte of huge profits recorded by banks annually, according to Engu and Warsaw (1979: 10) indicated that there is a ray of hope and government rural banking programme if well planned, coordinated and pursued vigorously will help to increase the banking habit of our populace, increase efficiency and effectiveness of it product management”. There w ill also be an increase competition among the banks for customers. As at the end of March 1985, there were thirty two commercial banks, operating Udi, Ezeagu and Udoji witu a total of one thousand one hundred and fifty nine (1,159) brand network. By share volume, the commercial banks are the most dominant and by December 1980, they had a total capitalization of N16,340.50 millions.  The competition among banks would center on non-price lines since the Central Bank controls the interest, the aggregate among to be lent to some categories of customers, the sector that more funds should be decided to what should be accepted as security for the loans and especially the type of business that banks should go into. How banks attracts serve and retain customers is left for to decide. All these put together including deposits, loans and advances make for effective product management. 
TABLE OF CONTENTSTitle page IIApproval page IIIDedication IVAcknowledgement VAcknowledgement VICHAPTER ONE INTRODUCTION Background of the study 1Statement of problem 4Objectives of the study 6Scope of the study7Statement of hypothesis 8Significance of the study 9Definition of terms 10

CHAPTER TWO Review of relation literature  12Literature review 12Origin of Nigeria banking system 16Banks defined 18Types of banks 19Differences between central banks and other banks 26Differences between commercial banks and merchant banks 28Commercial banks and rural banking development 29Financial institutions and rural development 31Rural banking scheme and relationship Between peoples bank, community, family support towards rural development 34
CHAPTER THREE   Research methodology 37Sources of data 37Population of study 38Sample size determinant 39Research instrument used 41Origin of data 42
CHAPTER FOUR Tool of statistical analysis 44Testing of hypothesis  55
CHAPTER FIVE Summary of findings, recommendation and conclusions Summary of finding 62Recommendation 64Conclusion 67Bibliography 70Appendix I 74Appendix II 77