CHAPTER ONE
1.0 INTRODUCTION
1.1 Background to the Study
The traditional banking business is the holding of deposit and lending money.

This role is developed from the fact that in any society it appears to exist too broad classes of people this surplus spending limit and deficit spending limit however; the following are some of the functions of commercial banks.
Intermediaries: the banks serves as intermediaries or middlemen between the people who saves there money in the bank and those who borrow the money from the banks.
Acceptance of deposit: this is undoubtedly the oldest function of the bank in the early stages of bank depositions usually paid a charge lost of keeping their income in the bank but as banking system modernized and well organized, banks realize the advantages that accrue to them through saving.
They promote saving investment the banks naturally pare the ways for this and investment debtors are by this means enticed to save more money since they are conscious of the additional money which the bank would give for any amount saved.
It serves as agent for payment by their policy commercial banks usually allows their customers to keep either current or saving accounts or both customers in this respect the most outstanding help is the lending of money to customers.
Another function is granting loan of loans when banks grant loans to their customer they normally credits the granted loans to the account of the borrowers.
Also the banks grants overdraft to their customers, they do this by allowing such customer to issue charges up to sum of the overdraft in additions to the original money which such customer has in the bank.
Finally, the bank do the bill of exchange and transaction of foreign exchange in the rural areas there is need for the establishment of banks deposit the effort made of the growth of bank in the rural areas since 1960 much integration in rural areas have met and establishment of bank have been centered in urban areas.

1.2 Statement of the Problems
The problem in this research work wants to deal with the hindrances encountered by the commercial banks on the process of their operation in rural areas.

Some of these can be stated as follows:
1. Lack of man power of commercial banks, poses a problem for them in their operation.
2. Lack of cordial/ customer relationship in rural area due to numerous branches
3. Illiteracy of customers in rural areas
4. Inadequate security outfit in rural area to secure the bank premises
5. Insufficient volume of business of the attitudes of farmers, hunters, and market sellers
6. Problem of accommodation encountered by staffs
The problem therefore is how to resolve the profit motives of the rural commercial banks and the essential services being rendered to rural dwellers.

This project work is designed to measure to what extent the rural commercial banks have been to involve the rural dwellers in the economic activities in terms of awareness.
The commercial banks are profit making organization.

There is a greater fear in establishing in rural areas where it cannot maximize profit.

Rural banking has being seen as indispensable if the nation is to develop its rural areas. The development of one rural area may not be a reality if services of commercial banks are not at the reach of rural dwellers.

1.3 Research Question
1. What are the basic problems encountered by commercial banks in rural areas?
2. What impact has the rural banking done on the rural dwellers?
3. What are the problems of rural banking in rural area?

1.4 OBJECTIVE OF THE STUDY
The objective of this study is to show reader the major problems encountered in rural banking system.
It also demonstrates the impact of rural banking on the agricultural production.
Furthermore, the objectives of this study is to point out user the justification of rural banking system in the rural areas with particular reference to the actives of the united bank for Africa balogun Fulani microfinance bank. Kwara state.
To make recommendation based on research finding on appraisal of rural banking development in Nigeria as a device for business growth and development.
1.5 SIGNIFICANT OF THE STUDY
The research work helped to expose the benefit of the rural banking development and also gave suggestion and information which can be used to improve the scheme they are as follows.
Improvement of the general standard of living of the rural areas economically and socially.
Promotion of credit facilities for the rural farmer to boast agricultural production, hence, self sufficiency will be achieved food production.
Production in the drift of young men and women from rural areas to the urban centre.