role of commercial banks in rural areas

Various economists have different views about the role of commercial banks in economic development. The engagement of commercial banks in rural areas is very little; this reflects, in part, the absence of standard elements upon which lending decisions are made. Schumpeter says, “It is the banking system which serves as a key agent along with the entrepreneur in the process of economic development”. Consequently, the number of accounts, advances to the agricultural sector, as also the number of banks offices in rural and semi-urban areas increased. However, an important effect in rural areas would be to restore lending to viable crop purchasing, equipment and input trading enterprises. (b) Social responsibility of commercial banks on rural dwellers. They play a decisive role in the development of the industry and trade. the total rural network of all scheduled commercial banks (including RRBs). Specially, they are meant to facilities the programmes of directorate of food, roads and rural infrastructural producers. Role of Commercial Banks in Rural Credit - Free download as PDF File (.pdf), Text File (.txt) or read online for free. Although our economy is mainly agrarian, banks play an important part in the development of our rural areas. Commercial Bank, which sponsored the regional rural banks.rural and semi-urban branches of commercial banks, 13, 932 rural and semi.

This research work is proposed to deal with role of the commercial banks in the development of rural areas in Nigeria. As the topic implied the role of commercial banks in the development of rural areas in Nigeria. The small and marginal farmers and landless agricultural workers, artisans and petty shopkeepers in rural areas are provided financial assistance through the regional rural banks in India. The bulk of the loans from RRBs have been given to pri ority sectors, which accounted for over 70 per cent of the total. This research work is limited because of time constraints, finance involved and sometimes non- response from people interviewed. (c) Their role in agricultural development and small-scale enterprises. The rural branches of banks provide various services to farmers, rural farmers, businessmen, and disadvantaged groups and help them to develop themselves thereby. In the meantime, the Working Group on Rural Banks (Chairman M. Narasimham) recommended in 1975 the setting up of Regional Rural Banks, as part of a multi-agency approach to rural credit. However, in the short term, this option may not be a solution for rural areas because private enterprises usually invest in commercial banking in urban areas before expanding to rural areas. As one of major roles of commercial banks is lending money by overdraft, installment loan, or other means, the study seeks to find out how those financial institutions can help the low income rural merchants expand their transactions by facilitating them to access to credit and advising them how to use those credits efficiently so as to uplift their standards of living and to develop the rural areas in general through commercial activities.