1.0 Introduction
1.1 Background of the Study
It has been observed that the banking arrangement in the country was not conductive to rapid improvement of banking in Nigeria for instance . The Lopsided nature of the banking system “at banking facilitiee in the country work inadequate , inaccessible and inconvenient for the masses. Further more the reserves under capitalization and liquidity ofbanks particularly.
The indigenous ones meant that banks often defaults in their obligations particularly before the 1952 banking ordinance, and this was not conductive to the development of banking habit as it undermines pubic confidence in the system. Prior to these features above, measures were then called for to attempt to eradicate these features and thereby help to develop the adequate banking habit in the country.
Given that more than 80% of the Nigeria population lives in rural areas and the rural banking has not made a sizeable impact on the economy and with 72% of the total population falling below poverty line learning grade level (1-4) substantiates the facts that the Nigeria economy is under bavased.
In his speech the former chairman of the united bank of Africa limited (UBA) (JULY 1982) it is generally aggred that the banking act 1969, which has its origin in the pre cential banking era. 1952 ordinance is a body of restriction at preventing banks from being a nuisance rather than a charter for positive economic initiatives for the transformatonof our society into a modern agricultural and industrial one”. In my own view , I will suggest that the country requires a banking sector which would allow as much diversity at can be compatiable with safety for the deposition of funds.
Prior to these therefore, it is important tonotethat one of the issues which should be adopted to tackle the above problems thee encouragement of mobile banking services and engendering (petition in the banking industry before going into details about the meaning of mobile banking services let me explain the meaning of a bank and a banking services.
A bank according to Kanu (2001:7) stated, that a bank could be defined from the following perspectives.
Banking act 1979 S. 3 (i) “ as an institution recognized as bank by the bank of england.
“The Problem with this definition is the link between recognition and the bank of England while this definition would be accepted in Britain , it will not be appropriate in Nigeria or any other independent nation(s).
Agricultural credits act 1928 s.5(7) defined banking as an institution , firm, incorporate companyor society carrying on the banking business and approves by the minister. The act did not explain what a bnking business and in some countries a bnking license is granted by the country central bank rather that a minister, hence the insufficiency of the definition.
Banking decree 1969 S. 41(i) “ defined a bank as any person who carries on the banking business in Nigeria” the person referred to here include a commercial bank, an acceptance house, discount house, merchant banks and other banking institutions section 31 (i.e) also defined what constitutes the banking business, however, the decree being a Nigeria decree vested the authority of granting a banking licence on a Nigeria authority.
Central bank of Nigerian Decree 24 and banks and other financial institutions Decree 25 both of 1991 “defined a bank as a Bank licensed under banks and other financial institution decree 25 of 1991 (CBN decree of 24 S. 53 and BOFID 25 S. 61). These two Nigeria decrees refealed the 1969 banking decree. However the deficiency of the definition is the same with that of the 1969 banking decree.
Companies Act 1948 “ defined a bank as any company which satisfies the deprtment of grade and industry that it ought to be so treated. The purpose of this definition was to distinguish between those companies that should be exempted from disclosing certain inforjation regarding profit and loss accounts and balance sheets like these other definitions. It is unsatisfactorily as a universal definition of a bank.
“A bank is therefore defined as an institution corporate or uncorported, recognized by a countrys highest monetary authority or government for the purpose of carrying on the banking business determined by that monetary authority or government.
“ A bank is therefore defined as an institution corporate or uncorporated, recognized by a country highest monetary authority or government for the purpose of carrying on the banking business determined by that monetary authority or government.
A BANKER could also be explained to mean below:
NWANKWO (1982) defined a banker as “ a dealer in debts and banking as dealing in debts” the beauty of this definition lies oon its relevance to modern banking especially the banker's function of money creation. A banker deals on debts, which he creates against himself and as well as makes a living by buying and selling money.
Kanu (2001:10) defined a banker as “any person or group of persons licensed to carry on the business of banking as specified by thee relevant banking laws” he also defined banking as any performance of any of the banking business.
Banking Business:
A banking business according to the provision of S.41 (e) of 1969 banking decree, could be said to includes:
Receiving monies from outside sources as deposits irrespective of the payment of interest. Granting of money, loans and acceptance of credits purchasing and sale of securities for accounts of others.
Purchase of bills and cheques.
Incurring of the obligation to acquire claims in respect of loans prior to their maturity. Assumption of guarantees and other warranties for others.
Effecting of transfers and cleaning.
Such other transactions as the central bank by order published in the federal Gazette designate as banking business.
Similarly, S.61 of the 1991 banks and other financial institutions Decree No. 25 is a simplified and modified provision of the 1969 banking decree. According to the 1991 Decree, banking business is the business of Receiving Deposits on current accounts , savins account or other similar accounts.
Paying or collecting cheques drawn by or paid by customers.
Such other business as the governor of the CBN may by o rder published in the Gazete designate as banking business. Having considered the meaning of bank , banker and banking business . one would deviate a little to consider the meaning of “mobile banking
“Mobile” according to advanced learners dictionary defined it as moving, able to be moved, easiy and quickly from place to place. Perry, (1985,9) defined mobile banking as motorized caravan fitted out as a small bank, which can tour outlying districts, on one ormore days a week, or go to fairs or agricultural shows. There are usually staffs of two to four who provides a counter services.
In a similar category are the fixed but temporary banks stands created during exhibituions such as the ideal homes, camping or do it yourself exhibitions at tait court and Olympia.
I will define “Mobile banking” as an institution corporate or unincorporated , recognized by a country highest monetary authority or government for the purpose of carrying on the banking business for the purpose of carrying on the banking business determined by that monetary authority or government with the ability to be able to be moved, easily and quickly from one place to another.
In most of our rural areas one can derive for half a day without seeing a shop, post offices or bank branch. No matter hw remote or self sufficient the inhabitants of the area may be, they are not able to afford the time to travel to the nearest branch of their bank.
As stuart (1981:89) of the bank of Scotland commented, “farming up there , they need all the daylight the can get, so if the crafter by road, air or sea”. If a crofther money for a new tractor or for land drainages, say or needs advice on insurance , investment or among other services that the banks provide, the staff of thee mobile relay the request. Home branch and a senior man or the money visits the customer.
1.2 Statement of the Problem
In view of all that have said above, it is clear that banking business in Nigeria could not be complete without prior consideration to the need for mobile banking services. The question are:
- No competent machinery to perform the function in mobile banking.
- If the can consider modernization of baning industry to be necessary in mobile banking.
- Would the rate of fraud, forgeries and armed robberies in the country affect the development of mobile banking , yes it will, if only the can find a means to sto it.
- It is important to have or create an effect against money laundering in the mobile banking services in Nigeria.
- All this problems started therefore critical analysis on the need of solution for banking service in Nigeria.
1.3 Objective of the Study
For any research work to be considered meaningful and effective, one must not fail to consider the objective of study. Therefore, in view of this research topic, the work is aimed at;
- Finding out the need for mobile banking services in the economy.
- Finding out the requirements for the establishment of the mobile bank,
- Finding out the problem and constraints associated with the establishment of the mobile banking in the economy.
- Finding out the importance of mobile banking service to the economy)
These and more are the objective of this research work.
1.4 Scope of the Study
Generally, the scope of this research work covers both the commercial and merchant banking system(s) in the banking sub sector. This is why it Is regarded as an “analysis” as a unit of this wide coverage, the choice of questionnaires respondents was prepared to cover both the commercial and merchant banks in the economy , who could understand the questionnaire and presumable give unbiased and reliable answers.
1.5 Research Question
- How many banks have adopted the use of mobile banking services in the sub-sector?
- Would the rate of fraud, forgeries, and armed robberies in the country affect thee development of mobile banking?
- Mobile banking service bank any relations with E- banking?
- Would mobile banking services help effectively in transformation of the Nigeria banking sub — sector.
- Does mobile banking service help in the transfer of fund?
1.5 Significance of This Study
This research topic in consideration would enable the government and the private sector of the economy to fashion out means and modalities on he need for th establishment of mobile banking services in the banking subsector.
This is because , if mobile banks are established into the economy, the following below would be its added advantage(s).
- It will ease the movement of funds both withing and outside the area.
- It will facilitate thee setting of debts between people and thus improves business efficiency.
- It will provide a place of safefy for personal savings of which of course, the bank at this service time offers standards rate of interest.
- It will provide a depository base for the customers article of value.
- It will open up opportunities for employing fresh bank staff locally.
- It can equally provide working capital for local business and losts.
1.7 Limitation of the Study
Generally a study like this is as could be expected fraught with many limitations. Time constraints is clearly at the fore front, considering the facts that the researcher is a student and have many other courses to study while also carrying out this research work. This has in no small way harrowed down the ability of the researcher to source all valuable data tht would have been useful and helpful in carrying out this study.
Finance also is very essential in a study of this nature because transportation cost is an inevitable cost and must be paid for especially now that the economy had just experience an increased in the pump price of fuel. Also, th search for data required for this study costs money, which in my case, financial support was not strong and this posed a serious handicap for the research work.
It is obvious also that for a study like this, a good and up to date statistics are necessary , if not important but unfortunately, such vital and up to date statistics were not readily available may be due to one reason of the other.
1.8 Definition of Terms
The operational definition of terms as they are used in the write-ups is given below:
Hub:
This is a center of where business activities are being carried out in a country.
A Bank:
This is defined as an institution , corporate or unincorporated, recognized by a country highest monetary authority or government for the purpose of carrying on the banking business determined by that monetary authority in government.
Banker:
A banker is defined as any person or group of persons banking as specified by the relevant laws.
Baking Business:
This is defined as the business of receiving deposits on current accounts, savings accounts and other similar accounts, paying and collecting cheques drawn by or paid in by the customers and the provision of finances to the customers.
Mobile Banking:
This is defined as an institution corporate or unincorporated , recognized by a countrys highest monetary authority or government for the purpose of carrying on the banking business determined by that monetary authority or government with the ability to be able to be moved, easily and quickly from one place to another.
Public Relation:
This is defined as the management function which evaluates public attitudes , identifies the policies and procedures of an organization or group of people with the public interest, and executes a program to action of action to earn public understanding and acceptance.
Economics:
This is defined as the study of relationship between workeerss performances and their environment, and in particular , the application of anatomical psychological and physiological knowledge emphasizes that the workers job has to be studied as a whole, with equipment, office and work planning, designed accordingly.
