CAPE COAST POLYTECHNIC

SCHOOL OF BUSINESS AND MANAGEMENT STUDIES

RESEARCH ON RURAL BANKS IN GHANA.

GROUP MEMBERS
          

PETER DAVID KOTOKO EUGENE SENANU DESEWU AGARTHA KUKUA MENSAH NAA AYORKOR AKRONG TAMAKLOE RICHARD FAFALI GANTUA SARAH TUFFOUR ACHEAMPONG BOAKYE YIADOM MATHIAS QUINOO VIVIAN TAKYI HELENA ASARE

TABLE OF CONTENT BACKGROUND OF STUDY

        

INTRODUCTION STATEMENT OF PROBLEM RESEARCH QUESTIONS RESEARCH OBJECTIVES METHODOLOGY DATA ANALYSIS AND PRESNTATION OF FINDINGS SUMMARY OF FINDINGS CONCLUSION OF THE STUDY RECOMENDATOINS

INTRODUCTION


A rural bank is community-owned and the share capital raised by the communitypeople in the community. It is registered under the Companies Code of Ghana as a Limited Liability Company. It is licensed under the Banking Law of Ghana by the Central Bank, the Bank of Ghana. The Bank is governed by a Board of Directors elected by shareholders in Annual General Meeting. The concept of rural banking was conceived in the 1960s with the search for a system to tackle the financial problems of the rural dwellers. The need for such a system was necessary because the bigger commercial banks could not accommodate the financial intermediation problems of the rural poor as they did not show any interest in dealing with these small-scale operators. smallThe first rural bank, Nyakrom Rural Bank Limited, was opened in Agona Nyakrom in the Central Region

BANKING STATISTICS
YEAR 19761976- 1980 19811981- 1985 1986 1990 1991 1995 1996 1997 1998 2000 2001 1999 2001 2003 TOTAL ESTABLISHED +20 +86 +16 +3 +5 +3 -23 +5 +2 +14 TOTAL EXISTING 20 106 122 125 130 133 110 115 117 131

1999 - 2000 2004 - 2011

STATEMENT OF PROBLEM


Latest banking statistics provides that more banks are extending their branches to the local areas. This has resulted in a significant level of competition between the rural banks and traditional banks. The major issue is that most local customers prefer the traditional banks to the rural banks. This has resulted in the rural banks loosing their customers.

RESEARCH QUESTIONS


Why do people prefer traditional bank to rural banks?

Why are Rural Banks losing more customers?

RESAERCH OBJECTIVES


The general object of the research is to identify the reason why people prefer traditional banks to rural banks.


  

Other specific objective includes: to find out

Why rural banks are losing customer How rural banks can acquire more customers. Attempt to offer suggestions and recommendations on finding on the research.

METHODOLGY


The source of data collection was primary and secondary. The primary data was captured from a sample of C- poly students and traders through the administration of questionnaire and semi structured interviews. The secondary data was collected from books, journals, internet and the research works.

METHODOLOGY


A sample size of hundred people were selected from the population to respond to a questionnaire. 100% of the sample size responded to the questionnaire Simple random probability method was used in selecting the sample size

SAMPLE OF THE QUESTIONNAIRE USED

                                  

CAPE COAST POLYTECHNIC MARKETING DEPARTMENT  QUESTIONNAIRE FOR A SURVEY ON WHY PEOPLE PREFER TRADITIONAL BANKS TO RURAL BANKS. BANKS. This questionnaire is purely for academic work. All information provided will be confidential and will not be used for any other reason. other
 

1. Sex of correspondent. Male 2. Age. 1818-24 25-30 253. Are you employed? Yes 4. If Yes, what is your occupation? 5. If No, are you a student? Yes 6. Do you know about Rural Banks? Yes

Female 31-35 31No

36-40 36-

Above 40 ..

No No No both .

7. Do you have a bank account? Yes 8. If yes, were do you save? Rural Bank Traditional bank 9. Which bank do you save?

10. If Rural bank, do you like their services? Yes No 11. If No, which part of their services needs to be improved? . . . 12. Why save in that particular bank? . . 13. Why do you prefer a traditional bank or a rural bank? .

..

14. If you don t have a bank account, were would you like to open one? Rural Bank Traditional bank both 15. Why would you open an account with a Traditional bank or a Rural bank? ............ .. THANK YOU.

DATA ANALYSIS AND INTERPRETATION OF FINDINGS FROM SAMPLE

GENDER MALE FEMALE TOTAL

FREQUENCY 48 52 100

PERCENTAGE 48% 52% 100%

AGE RANGE OF SAMPLE

AGE RANGE 1818-24 2525-30 3131-35 3636-40 ABOVE 40 TOTAL FREQUENCY 49 21 11 10 9 100 PERCENTAGE 49% 21% 11% 10% 9% 100%

OCCUPATION STATUS OF SAMPLE

SAMPLE SIZE STUDENTS WORKERS TOTAL

FREQUENCY 58 42 100

PERCENTAGE 58% 42% 100%

BANKS ACCOUNT STATUS OF SAMPLE

SAMPLE SIZE FREQUENCY PERCENTAGE 81% 19% 100%

PEOPLE WITH 81 BANK ACCOUNT PEOPLE WITHOUT 19

BANK ACCOUNT

TOTAL

100

BANK STATUS OF SAMPLE SIZE

SAMPLE SIZE PEOPLE WITH RURAL BANK ACCOUNT PEOPLE WITH TRADITIONAL BANK ACCOUNT PEOPLE WITH ACCOUNT IN BOTH TOTAL FREQUENCY PERCENTAGE 10 12.4%

59

72.8%

12

14.8%

81

100%

SUMMARY OF FINDINGS


From our study we found out that 81 of our sample size have bank accounts, 19 do not have bank accounts. Out of the 81, 10 have bank accounts in Rural banks, 59 in Traditional banks and 12 in both banks. This proves that customers prefer traditional banks to Rural banks. Below are the reasons stated by the sample size .

REASONS WHY THE SAMPLE SIZE PREFER TRADITIONAL BANKS TO RURAL BANK


Traditional banks have more branches Traditional banks offer better services, such as: internet banking, payment of bills and money transfers. Traditional banks are more customer oriented. Traditional banks provides Automated Teller Machine (ATM), which the rural banks do not. Large sums of money cannot be cashed instantly at Rural banks, unless prior notice is given. Rural banks are more liable to liquidation. Prestige.

CONCLUSION OF THE STUDY



Rural Banks were established to help manage the finances of people in the rural areas. Latest statistics provides that Traditional banks are also extending their branches and services to the rural areas. This has created a form of competition among them. It has also resulted in the rural banks loosing their customers to the traditional banks. From our study we realize the following reasons can account for the problem. Traditional banks have more branches. Traditional banks offer better services Traditional banks are more customer oriented Easy access of money through ATM service Traditional banks provide modern standard of banking. Large sums of money cannot be cashed.

     

RECOMMENDATIONS
Based on the findings of the research, the following recommendations are made.


Rural banks should open more branches or network with other rural banks all over the country Rural banks should improve their services by adopting modern standard of banking. They should also improve their customer service by making customers the centre of their activities. The bank of Ghana should increase the bank reserve of rural banks Rural Banks should provide Automated Teller Machines (ATM)

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THANK

YOU