ABSTRACT

The study investigated on effect of micro-finance banking on rural development in Nigeria. The major objectives of the study are to examine the effect of microfinance bank credit on rural development,to determine the effect of microfinance banks loan on agricultural   and productivity and to ascertain the effect of microfinance bank on job creation in rural areas. The researcher adopted primary data in getting the required information.In testing the hypotheses, regression analysis was  used .  The findings revealed  that  microfinance  bank  credit  has a significanteffectonrural development.Thefindingsfurther revealed that Microfinance  banks loan hasasignificanteffect onagricultural productivity.Theresearcher  recommendsthat the overall  state  of liquidity  should  be improved  so as to have  afavourable  impact  on the profitability ofthecompany.Theresearcher  also recommends  that Microfinance  banks should develop anofficial credit-rating  system ineasier way,even ifinuIunitedmanner,inorder tu assistruralareas intheir development.  Thestudyfurther recommends  thatMicrofinance  banks should ensure thattheyaresocially responsible  totheir host community.  Thatwould contribute toruraldevelopment. 

TABLE OFCONTENT

CHAPTER ONE:INTRODUCTION

1.1 Background ofthestudy 1

1.2 Statement oftheproblem 3

1.3 Objectives ofthestudy 5

1.4 Research questions 5

1.5 research hypothesis 5

1.6 Significance ofthestudy 5

1. 7 Scopeofthestudy 6

1.8 Limitation ofthestudy 6

CHAPTER TWO: REVIEW OFRELATED LITERATURE

2.1Conceptual framework                                                                                                               8

2.1.1Features ofmicrofinance  banks9

2.1.2Financial methods ofmicrofinance banks                                                                           10

2.1.3Relevance ofmicrofinance  institution (MFIS) inNigeria                                                 11

2.1.4TheNigerian microfinance  context                                                                                      14

2.1.5TheNigeria microfinance  banks (MFBS):originandbenefits                                        17

2.1.6Nigeria commercial banks and microfinance                                                                      20

2.1.7Impactofmicrofinance on rural development                                                                    20

2.2Theorical framework                                                                                                                  23

2.2.1Theory ofmultiple lending                                                                                                    23

2.2.2Creditmarkettheory23

2.2.3Holdup  and soft budget  constraint   theories24

2.2.4 Loan pricing  theory                                                                                                                             25

2.2.5Monetary   circuit  theory                                                                                                                     25

2.3Empirical   review25

CHAPTER   THREE:RESEARCH    METHODOLOGY

3.1 Research   design30

3.2 Area ofthe study30

3.3  Method  ofdata collection30

3.3.lQuestionnaire30

3.3.2Personal  interview31

3.4Population   ofthe study31

3.5 Sample  and sampling   techniques31

3.6Validity  ofinstrument32

3.7Reliability   ofthe instrument32

3.8Method  ofdata analysis32

3.9Model  specification32

CHAPTER   FOUR:  DATA  PRESENTATION      AND ANALYSIS

4.1Datapresentation34

4.2Dataanalysis36

4.3Testofhypothesis40

4.4Discussion offindings41 

CHAPTER FIVE: SUMMARY  OF FINDINGS, CONCLUSION  AND RECOMMENDATIONS

5.1Summary of findings 43

5.2Conclusion 43

5.3 Recommendations 44

REFERENCES45