CHAPTER ONE
1.1 INTRODUCTION
This chapter is mainly concerned with the efforts at expanding the economic base of the rural area which are always backwards because of scarcity of and restrictive access to loanable funds. In solving the problem, previous government in their economic policies have lied on development banking and rural branch banking of orthodox banks. The word Community Banking is defined as a self sustaining financial institution owned by a community or a group of communities. Unlike commercial banks, community banks were established mainly to promote productive activities in the rural area. Specially, they are meant to facilities the programmes of directorate of food, roads and rural infrastructural producers. Community bank has no other branch because it is established to operate within a community alone. It is well known that 75 percent of the country’s resource and ointment are in the rural areas. So our development project and programme can not achieve any appreciable improvement until this is focus on those rural areas.
1.2 BACKGROUND OF THE STUDY
The federal government of Nigeria 1990 budget speech decided to establish community bank in order to strengthen its programmes of grassroots economic development. The fundamental concept of a community banks is of a self-sustaining financial institution, owned and managed by a community for the purpose of providing credit deposit, banking and the service to its members. It is designed to ensure that a community may establish a community bank for the purpose fo promoting rural development throughout the provision of finance and banking service improving the economic status of small scale producers both in the rural and urban areas, enhancing the rapid development of production activities especially in the rural economic growth in Nigeria.
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