THE NOTION NURSED BY RURAL PEOPLE TOWARDS BANKING
THE NOTION NURSED BY RURAL PEOPLE TOWARDS BANKING
BACKGROUND OF THE STUDY
The origins of what is now known as Bank have been linked to several countries. Some notable histories, however, ascribe its origin to VENICE, an Italian city. According to one theory, the term “bank” was derived from the Italian word “banko,” which means “bench.”
A bench, on the other hand, is a market place where money was traditionally exchanged. This transaction was carried out by Lombard Jews.
Around the beginning of the thirteenth century, some officials known as Lombard Merchants began the business of money deals, employing bills of remittances. This type of practise was almost as common in the south of France at the same time.
However, authorities in the south of France claim that they were placed in front of church doors to exchange money from foreigners, rather than the market, and that due to the efficiency of the latter merchants, they went on to expand their business to other countries around the world.
As time passed, the merchants' tenths imposed on the people were brought under scrutiny. This practise was overseen by a group of wealthy and prominent members of society.
When these supervisors began their duties, they required the merchants to deposit a set amount of money as a guarantee for their good fortune.
In the end, both sets of merchants made their way to England and continued on their business on the streets that they chose. Though banking did not originate in England, the country did embrace it in a unique way.
After some rigours were passed, the Bank of England rose to prominence. The adage “Uneasy lies the head that wears the crown” was applied to England as they worked to improve their banking innovation.0
Then, in England, many people entrusted their possessions with the King of the country for a variety of reasons. Nobody is going to leave his money or possessions with someone he does not trust, and the monarch was the only person in whom many people had confidence.
He also had private army and could be counted on to successfully defend his palace in times of crisis and external attacks. Money and valuables left with the king were thus seen to be much safer than when held or placed elsewhere.
On the other hand, the monarch was continuously in need of money, particularly for the purpose of carrying out the day's conflicts.
As a result of the preceding history, the king frequently spent the money entrusted with him and defaulted as a result. People were hesitant to leave their money with the king for safekeeping at this time because financial infidelity had undermined their trust.
Furthermore, they refused to lend him money because there was no longer any assurance of safety for their money or goods. As a result, a stop to this heinous trend was sought, and banking was the greatest solution.
Banking evolved many years before the establishment of the Bank of England, as evidenced by the table below.
DATA PLACE (INAD)
1171 Bank of Venice
1345 Swiss Francs at the Bank of Geneva
Barcelona 1401 is a bank in Barcelona, Spain.
Genoa 1407 Bank of Italy
The Amsterdam Bank was established in 1607.
Hamburg 1619 Bank
The Rotterdam Bank was established in 1635.
The Bank of Stockholm was founded in 1688.
The Bank of England was established in 1694.
As previously stated, the impetus for the formation of banking stemmed from people's desire for a secure place to keep their money and other valuables. Many wealthy individuals of society were considered for this reason during the hunt.
Accountants, solicitors, scriveners, and goldsmiths were among those in this category. The goldsmiths were seen the most suitable, not because they dealt in gold, but because they had safes and had earned the community's trust as highly responsible members of society, and hence could be trusted without hesitation.
These goldsmiths accepted jewels from the public in exchange for receipts. They agreed to repay the jewels upon presentation of the receipts to the goldsmiths for payment; the depositor would simply send someone to the goldsmith for payment with the receipts.
Because they had gained the trust of the commercial society, the goldsmiths realised they could safely land enough to pay those who desired real money. The goldsmiths demanded a fee for storing money. They also make a change when it comes to lending money.
The profitability of this enterprise resulted in the fourth stage of banking evolution: rather than waiting, the goldsmiths started out to attract deposits by offering to pay interest.
They did so because the more deposits they had, the more lending they could do and the more profit they could make. With that in mind, we can now define banking or a bank.
A bank, according to the Oxford Advanced Learners Dictionary, is “an establishment for the custody of money that pays out on a customer's order.”
This definition is clearly inadequate since it conveys the impression that a bank is nothing more than a cloakroom where one deposits an item, such as a briefcase, and subsequently returns that same suitcase. This may be the way the first banks operated, but no bank functions in the same way now.
From the foregoing, it is obvious that banking activities extend beyond the mere storage of money. Thus, banking can be defined as the act of dealing in money and managing loans, as well as the preservation of non-perishable goods such as gold, silver, and other easily convertible to money.
As the previous paraded erudite and merchants, the cities in Nigeria received banking services before those in the rural areas; thus, banking services are available in the country's rural areas. This was known as rural banking.
Rural banking in Nigeria dates back to 1921, but it became more effective in the 1970s as a result of the Central Bank of Nigeria's efforts to centralise banking services throughout the country. During the program's implementation, the Apex Bank directed existing commercial banks to open branches in rural towns,
while the Central Banking provided logistical support. During the first phase of the initiative, 200 commercial bank branches were created around the country. More commercial banks joined the scheme in the second and third phases, and more rural branches were constructed.
Nonetheless, banking in Nigeria's rural areas was not without its challenges. Because it meant doing literate commerce amid illiterate and peasant farmers, its acceptance among the rural community was hampered. Not only were the rural areas full of illiterates, but they were also sceptical of modern technology.
Those who were willing to accept it, on the other hand, might not have enough to keep in the bank. Furthermore, the lack of social utilities such as access roads, piped water, electricity, and so on has exacerbated rural banking's productivity challenges.
However, the aforementioned rural banking issues may be on the decline as a result of widespread globalisation and current competitiveness in the banking sector.
Today, more than 70% of rural residents have received basic schooling, which provides them with the bare minimum of knowledge required to operate a bank account.
Following this, the conservatism fostered by rural inhabitants towards banking progressively faded. The government has also boosted its allocation of social facilities in rural areas at various levels.
Finally, the presence of many commercial bank branches in rural areas has created intense competition among banks, resulting in improved operations in today's rural banking.
All of the above factors add up to provide modern rural banking a better shape. However, one cannot infer that rural banking in Nigeria is without problems, because each level of development poses its own set of challenges.
1.2 STATEMENT OF THE PROBLEM
When seen from different angles, rural people's attitudes about banking might be divergent and very broad. These points of view could include:
a) Rural folks do not accept banking money the same way they do money stored in their homes.
b) Rural people do not fully comprehend the role of banking in their culture.
c) Participation in rural banking is difficult because of substantial time waste and, at times, refusal of services.
d) On the bank side, the rural inhabitants' bad banking attitudes, along with their little financial contributions, may be insufficient to sustain good banking services in rural areas.
The issue here is not just that rural people are unaware of the existence of banks and banking operations, but also that banking facilities are inaccessible in rural areas. There is evidence that fewer banks than needed exist in rural regions, contributing to the arduous process of rural banking.
Many rural residents are discouraged from dealing with the bank again after an initial setback in retrieving money or other items lodged with the bank. The explanation for this behavioural disengagement is not difficult to find;
rural residents have constructed their lives around strict schedules, and any impediment to that (e.g. bank) is strongly rejected.
Thus, the extended time spent at the bank, together with some anomalies in banking services, all combine to constitute a significant threat to rural banking.
(1.3) OBJECTIVES OF THE STUDY
(i) To ascertain rural residents' attitudes towards banking.
(ii) To identify the factors that influence rural people's attitudes towards banking.
(iii) Determine the amount of rural people's awareness of banking in rural communities.
(iv) Determine bankers' perspectives on rural people's attitudes towards banking.
(v) To ascertain the measures implemented by Nigeria's central bank to promote rural banking in the country.
(1.4) SIGNIFICANCE OF THE STUDY
This research is extremely important to various groups of people not only in the educational context, but also in the larger community. These people fall within the following categories:
(i) The Researchers: Among other things, the research has appropriately exposed the researchers to research finding abilities, which undeniably works. The researchers' results and recommendations can also serve as a reference material for order researchers outside the organisation.
(ii) The government: It is clear from all implications that the researcher searched far and wide for crucial information regarding the topic; hence, recommendations made by this group might be a valuable tool in the hands of the government for future planning and budgeting.
(iii) The Bank: Banking from the People's Bank to the Central Bank of Nigeria (CBN), the project has detailed various processes and roles owned by the various body (ies) towards guaranteeing functional rural banking.
(i) What are rural residents' attitudes towards banking?
(ii) What are the factors that influence rural people's attitudes towards banking?
(iii) What is the level of awareness of financial services among rural people?
(iv) What are bankers' perspectives on rural people's attitudes towards banking?
(v) What steps has the Central Bank of Nigeria done to boost banking in rural areas?
(1.6) SCOPE OF THE STUDY
This study is supposed to be limited to the Enugu East Local Government Area, which contains the following banks:
i. The First Bank of Nigeria PLC
ii. United Bank for Africa (UBA)
The study group, the supervisor, the entire school, the bank community, and the rural inhabitants, not to mention our sponsors, parents, and guardians, all contributed to the success and accomplishment of this project work. The leader's academic vitality and research propensity are worth emphasising at this time, as are his peaceful coexistence and potency.
Despite the above-mentioned unity of the various personnel who saw to the achievement of this project's work, problems were unavoidable. Time and financial constraints posed a significant threat to impoverished students, who could best be regarded as slaves of time and finance;
also, obtaining information from rural people or even gaining entry to communities was arduous and time-consuming. Though all of these obstacles were surmounted to create the research academic heroes, the process was not easy.
1.9 DEFINITION OF TERM
1. Attitudes: A person's behavioural pattern of reacting.
towards a particular issues.
2. Banking: The management of debts and the exchange of money.
3. A banker: A person who works in the banking industry.
4. A bank is a financial institution that deals with debt management and the exchange of actual money and other goods.
5. Rural People: people who reside in less developed areas and often lack basic social services.
6. Valuables: Precious, perishable items owned by an individual that can be sold for a profit.
7. Goldsmith: A person who creates gold jewellery.
8. Interview: A method of gathering information from an individual, either orally or in writing.
9. Questionnaire: A planned or unstructured form of jotting down questions with the goal of obtaining information from the respondent.
10. Local Government Area: The third level of government
in the Nigeria Political System.
The Central Bank of Nigeria is the country's top bank.
The nation in charge of the action.