The impact of rural bank credit facilities on rural development in Ghana. A case study of Amuga Rural Bank Ltd

Abstract

The importance of the rural banking in the economic development of a country cannot be overlooked. Hence, banks and other financial institutions are considered to be a vital role for the development of the rural economy in Ghana. The Government of Ghana through the Bank of Ghana introduced and established Rural Banks in 1976 as one of the strategies to facilitate the development of rural communities. Aside inculcating the habit of banking in the rural dwellers, the Rural Banks were to mobilize funds and channel them to productive ventures in the rural areas. The rural banking sub sector has become a growing and a vibrant part of the whole banking industry and the Ghanaian economy as a whole. Aside the disbursement of credit facilities which has helped in improving the living conditions of the beneficiaries, the Rural Banks have also, created employment and has helped in inculcating the habit of banking in the dwellers of the rural communities. The study sought to determine the impact of rural bank financial facilities of the rural poor with respect to income, employment, occupation and savings. Questionnaires and interviews were used to elicit responses on socio-economic characteristics and other relevant variables from a random sample of seventy (70) respondents from the catchment areas of the bank. The analysis showed that the rural banks have positively impacted on socioeconomic development of the rural people and these have manifested in the areas of income, employment, occupation and savings.