American Journal of Economics, Finance and Management
Articles Information
American Journal of Economics, Finance and Management, Vol.4, No.3, Sep. 2018, Pub. Date: Sep. 4, 2018
Role of Banks in Funding Agro Based Organization: A Study on Some Selected Commercial Banks in Bangladesh
Pages: 98-110 Views: 1822 Downloads: 546
Authors
[01] Md. Masudul Hassan, Department of Agribusiness, Atish Dipankar University of Science & Technology (ADUST), Dhaka, Bangladesh.
[02] Noor Nahar Begum, Faculty of Business Studies, Bangladesh University of Professionals (BUP), Dhaka, Bangladesh.
[03] Samira Islam Resmi, Department of Agribusiness, Atish Dipankar University of Science & Technology (ADUST), Dhaka, Bangladesh.
Abstract
The rapid advances that are occurring in the areas of information, telecommunication and transportation technologies are further accelerating this phenomenon of globalization. Globalization will also affect national economies, including the Agro based Organization and its various activities. Commercial banks as the most important functionary of the financial system play a dynamic role in the economic development of a nation through mobilization of savings and allocation of credit to productive sectors. This paper examined the role of some selected banks commercial bank in funding Agro-based organization Bangladesh. Data was collected from secondary sources. One sample T-Test, regression, correlation was used for analyzing the data and results discussion. The foremost determinations of this study show that how the output performance of Agro based organization was influenced by four factors namely Commercial banks credit, Interest rate, Inflation rate, Exchange rate. After the regression, the result shows that firstly: commercial bank credit and exchange rate has positive significant effect on output performance of Agro based organization in Bangladesh whereas; interest rate and the level of inflation has negative effect on output performance of Agro based organization, although they are both significant. Some problems were found from the study & some recommendations were catered for future use to any researcher in this hypothetical arena. Commercial banks should increasingly involve themselves in development financing in order to gain long-term viability benefitting themselves as well as the economy, but that should not occur at the cost of viability of the total financial intermediation process. However, Government should take deliberate efforts to increase funding in agriculture to increase Agro based organization funding in the country as well as intervene in the interest rate level in order for it to favour the common man in the country.
Keywords
Globalization, Agribusiness, Commercial Banks Credit, Sustainable Development, Financial Institutions
References
[01] Afolabi, M. O. (2013). Growth effect of Small and Medium Enterprises (SMEs) Financing in Nigeria, Journal of African Macroeconomic Review. 3 (1): 193-205.
[02] Amin, A. A. (1996). The Effect of Exchange Rate Policy on Cameroon’s Agricultural Competitiveness. Nairobi: ARC Publishers.
[03] Acha, I. A. (2012), “Non-Bank Financial Institutions and Economic Development in Nigeria”. International Journal of Finance and Accounting, 1 (2), 14-22.
[04] Agrico Limited (2014). Agribusiness Development Project. Final Report.
[05] Binswanger, Sinha, Radha (2009). Food and Poverty: The Political Economy of Confrontation. London: Croom Helm.
[06] Dada, R. M. (2014), Commercial Banks’ Credit and SMEs Development in Nigeria: An Empirical Review. International Journal of Research (IJR) 1 (8): 305-320.
[07] David, J. H. and R. A. Goldberg, 1957. A Concept of Agribusiness.
[08] Essang, S. & Olajide, S. (1974). Intermediate Economic Analysis. Ibadan: Aromolara Publishing Company Limited.
[09] Emmanuel. O. E. (2008). Macroeconomic Environment and Agricultural Sector Growth in Nigeria. World Journal of Agricultural Sciences. Vol. 8, No. 16.
[10] Ekezie Y. O (1997) Constraints to Increasing Agricultural Productivity in Nigeria: A review. Nigeria Strategy Support Program (NSSP) Background paper No. NSSP006.
[11] Fosu, K. F. (1992). The Real Exchange Rate and Ghanas Agricultural Export. Nairobi: ARC Publishers.
[12] FIDA, B. A. (2008) The Importance of Small and Medium Enterprises (SMEs) in EconomicDevelopment. Banking, finance and accounting community. URL http://www.thefreelibrary.com/The+Importance+of+Small+and+Medium+Enterprises+%28SMEs%29 +in+Economic...-a01073924138.
[13] Ijere, M. O. (1996). New perspectives in Financing Nigeria Agriculture. Benin: Dimension Publishers.
[14] Ijaiya, G. T. & Abdulraheem, A. (2000). Commercial Banks Credits to the Agricultural Sector and Poverty Reduction in Nigeria. A Calibration Analysis. Nigeria Journal of Agricbizand Rural Development. Vol. XL, No. 12.
[15] Imoughele, L. E and Ismaila, M (2013). Commercial Bank Credit Accessibility and sectoral output Performance in a Deregulated Financial market Economy: Empirical Evidence from Nigeria. Journal of Finance and Bank Management. 1 (2),: 36-59.
[16] Izar, A. and Tariq, M. (2009), “Impact of Institutional Credit on Aggregate Agricultural Production in India during the Post Reform Period”, Munich Personal RePEc Archive, Retrieved 24/8/2013. http://mpra.us.uni-mucnchen.de/id/e print/17075.
[17] Merlinda, D. Ingco& John D. Nash (2004).’’ Agriculture and the WTO: Creating a Trading System for Development. Washington, DC: World Bank and Oxford University Press. © World Bank.
[18] Muftau, A. I. (2003). Commercial Bank Credit to the Agricultural Sector and the Nigerian Economy. An Analysis of the Future Trend. A Journal of Department of Business Administration. Vol. 28, No. 32.
[19] Merdynwati, H., Yunanto, M. and Gunadarma University (2011), “Banking Development, Agriculture and Manufacturing Industry Sector in Economic Growth in Indonesia: Do They Influence?” International Journal of Trade, Economics and Finance, 2 (4), 312-316.
[20] Nzotta, S. M. (2012). Nigeria: Money Banking and Finance Theory and Practice. Lagos: Intercontinental Publishing.
[21] Nwanyanwu, O. J. (2011), “An Analysis of Banks’ Credit on the Nigerian Economic Growth (1992-2008)”, Jos Journal of Economics, 4 (1), 43-58.
[22] Onakoya, A. B. Fasanya, O and Abdulrahman, H. D (2013), Small and Medium Scale Enterprises Financing and Economic Growth in Nigeria. European Journal of Business and Management, 5 (4): 130-137.
[23] Qureshi U., Rahji U. V. (2006). Capital and Credit in Nigerian Agricultural Development. Nigerian Rural Development Study paper No. 6, University of Ibadan, Ibadan, Nigeria.
[24] SAEED, S. O. (2005) Role of SMEs in Pakistan. Pakistan & Gulf Economist, pp. 3 Available at: http://www.bizomer.com/Role-of-SMEs-in-Pakistan.html
[25] Stephen V. & Osagie U. (1985). Agricultural Household Models: Extension Application and Policy, London. The John Hopkins University Press.
[26] Terungwa, A. (2011). “Corporate social responsibility in Nigerian banking system: the development of small and medium scale enterprises.” World Journal of Social Sciences, Vol. 1. No. 5.
[27] Umoh, G. S. (2003). Macroeconomic environment and the Perennial Crops. Akwa: African Feb Publishers.
[28] Yaron M. & Hartford, CT (2013). Transactions of the Connecticut Academy of Sciences.
600 ATLANTIC AVE, BOSTON,
MA 02210, USA
+001-6179630233
AIS is an academia-oriented and non-commercial institute aiming at providing users with a way to quickly and easily get the academic and scientific information.
Copyright © 2014 - American Institute of Science except certain content provided by third parties.