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Financial A Small Scale Business In Nigeria Effect On Economic Development Prospect And Problems
[A CASE STUDY OF NIGERIAN AGRICULTURAL AND COOPERATIVE BANK LIMITED ILORIN]
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According to them they finance farmers cooperation organisation limited liability companies state and federal government agencies, also in addition the bank provide financing by direct investment in the equity capital of major agricultural agro – allied industrial ventures. The banks operation commenced with the establishment of a head office in Kadura and the opening of area office in Bauchi, Sokoto, Ibadan and Enugu.
Furthermore, the bank was able to sonation loans totally N304,222,000 from 1973 to 1980 under the direct tending and the lending schemes credit was channeled though co-operative societies and river basin authorities.
The objectives of the schemes is for the on lending agencies to endeavour to reach as many rural farmers as possible in order to remedy the situation, the NACB introduced the small holder direct loan scheme in March 1981, on pilot scale.
Under the scheme, each farmer could yet credit up to a maximum of 500 without resource to the provision of either collected or title to loan.
Furthermore, in order to consolidate this intervention at better delivery of rural credit to farmers, the bank (NANB) introduced the use of agricultural credit assistant with large scale ones which employ costly and highly sophisticated technology.
Short gestation period modern small scale industry enterprises are able to be implemented within a shorter period than large scale industries. This is possible because all the required inputs which are available locally can be quickly or organized.
Mobilizations of local resources including raw material technology, capital like a skilled labour entrepreneurship and demand which will otherwise remain unutilized are effectively and efficiently tapped in the care of small scale industries.
Labour, including the skilled which exist in abundance but are employed or under employed.
Foreign exchange saver, increase production of various industrial item which are important would help to serve substantial amount of foreign exchange provided there are judiciously and progressive monitored programmes for such important substitutes production can be constitute the spring board for industrialization on.
Efficiency and quality if have exist many scale industries in the rural areas, there will occur enough health competition by ways of efficiency and quality of product manufactured. The competiveness will be such that quality product would be made available for consumer consumption (ANAS) as immediate contact personnel for the rural farmers.
The experience of the NACB was quite bandy in the discussion or rural lending we then concluded by a thought provoking discussion in the prospect for enhanced rural development through agricultural lending.
The most interesting of the strategies is that of subsiding interest rates our conviction is that a subsidy on interest rate restricted only for small rural farmers will serve as an incentive to encourage rural farmers to increase their product it will help to reduce the high cost of credit delivery to this group of farmers.
Finally, it is our conviction the rural small scale farmer was a lot of potential for improving and increasing food and production in the country NACB has prove to be a good financial institution which help a lot in financing some small scale business mainly agricultural basis.
1.7 DEFINITION OF TERMS
Small scale industries enjoy effective and sound administration since the average number of manager and supervisors. The employees as well catered for, which oils the wheels of progress sound and operatic worker given the available tools would put forth sound performance.
Labour intensive various small scale industry – enterprises are characterized by efficient and effective voe of techniques of higher labour intensiveness in relationship to capital (low capital – labour ration) such industries are efficiently operated side by side.
The small business act states that a small business concern is “one that is independently owned and operated and which is not dominant in its field of operationâ€. The law also states that in determining what constitutes a small business, the definition will vary from industry to industry to reflect industry differences accurately.
When the U.S. congress first established SBA, the fundamental question was just what numerical definition should SBA use to define small scale business, industry by industry, to determine what business were eligible for SBA’s programs.
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