CHAPTER ONE
INTRODUCTION
1.1 STATEMENT OF PROBLEM
The Nigeria agricultural and cooperative bank (NACB) was established in 1973 to help in the development of country’s economy through providing agricultural aids as well as provide finance and assisting the formers and cooperative societies. The needs for financing some of these agricultural project brought about the establishment of the Nigeria agricultural and cooperatve bank (WAB) in 1973 which after inception marked a dynamic change in providing credit faculties to the farmers and finance for industrial processing and marketing of agricultural product. They also serves as a national bank in development of agricultural in Nigeria as a way of improving the Nigeria economy.The bank developed especially for the purpose of credit delivery to agricultural sector through. The loan is made available to clients to enable them purchase excess crops during harvesting seasons. This practice has eliminated wastage and served as incentive to farmers to produced more crops. The duration of the loan is between a and 21 months. The Nigeria agricultural cooperative bank was established to produce financial and other logistic support to agricultural sector but they could not achieve the purpose.
PURPOSE OF STUDY
v To evaluate the role of the WACB in the growth of the Nigeria agricultural sector
to determine how the bank has improved the financial position of small and medium scale formers.
v The sources of the bank are supplied form the following sources.
v Equity capital by the federal government
v Statutory financial allocation from the government
v Loans from the government
v International financial market
v Short falls from commercial and merchant banks, which are passed on to WACB by the central bank as loans.
1.2 RATIONALE OF STUDY
v The production of feed for animal: Agriculture provide feed for the animal that turn the feed into animal protein for human consumption
v The foreign exchange earning: It help agricultural product form major export product in many countries especially the industrialized countries of African
v It help to provide income for the farmer and people are in one way of the other connected with agriculture
v Provision of employment: it helps to creates employment for million of people all over the world and also increase the percentage of people that engage in agriculture
v It also provide raw material for our various industry
1.3 SIGNIFIANCE OF THE STUDY
The people that will benefit from this work are as fellows farmers, exporter industry, this is because WACB are out to help people that deal in agricultural business so as to develop their business and as well as our country. Wacb are out to give technical advice to industrialist for example, they help new industrialist to know possible sources or raw material as well as possible markets for finished products. Again they encourage exportation of Nigeria good by giving loans to viable exporting firm that need such assistance. Also they give long and medium term loan to prospective farmers and traders. The farmers who are substance will now from help of NACB grow to commercial farmers
1.4 DEFINTION OF TERMS
Short term loan : advances or capital granted to customers by banks which is usually due within one month to one year for repayment
Collateral : this is security used in guaranteeing loan and credits
Small and medium scale farmers : these are farmers that cannot operate on large .
Scale production : they are mainly subsistent operators that are not use to sophisticated machines for farming
Capital : this is refered to as money and other form of productive assets
Medium term loan : loan between short and long loan usually due within three to five ears for repayment
Long – term – loan : loan that will be due for repayment between five to thirty years.
On Lending: this is an indirect form of lending to prospective borrowers.
