The primary objectives of this study was to examine how the financial institution export finance in Nigeria using First Bank of Nigeria Plc Onitsha branch as a case study. In carrying out this study, I used survey method in which I used the questionnaire to collect data. The target population was the staff of first bank of Nigeria Plc Onitsha Branch from which a sample of 80 was drawn. I used research questions and formulated research hypotheses. The relevant literature was reviewed for the study. The data were collected, presented analyzed and hypotheses tested using chi-square. At the end of the study a number of recommendations were made for further studies and on how to improve the Nigerian financial export in Nigeria and how to encourage the institutions for expansion and modernization.




Financial institutions are organizations which deal basically in money.

They constitute the financial framework of an economy. Financial institutions help to pool savings and excess liquidity from millions of individuals and firms within the country and make them available to those who need them for various purposes.

Financial institutions include commercial bank (Joint stock banks) discount houses, the central bank, saving banks, development bank (BOI), insurance companies, hire purchase companies, the national providence fund, the stock exchange building etc.

Before the introduction Nigeria export- import bank (NEXIM) in Nigeria as at 1999 the commercial banks were generally referred to retail bankers, while merchant banks were known as wholesale bankers.

However the two operate and offer almost the same services that any line of demarcation is now rather fussy- one can only say that the distinguishing factor between the two sectors of the banking industry is that the commercial banks are members of the central bank of Nigeria (CBN) clearing house, While the merchant bank are not members of the Central Bank clearing house.

Another contentious factor is the licence granted merchant banks to take companies to capital market which the Nigeria stock exchange denied the commercial licensed them to do so, the introduction of the universal banking system of divide effect. A trader could approach either commercial or merchant bank for financing facility for his transactions. They can provide both short and long term facilities and can design any product which meets any requirements of customers.

The Nigeria export-import bank (NEXIM) was established in 1988 but commenced operations in January 1991. The bank was established to provide mainly short term financing for exporters who need working capital to buy hair activities. Among the function of the banks is the maintenance of a foreign exchange revolution fund which is to be made available as loans to exporters who need to export machineries, raw materials and spare parts to satisfy export orders. It can also consider loans involving domestic trade which are likely to assist exports.


The banking system has been integral part of the structural reforms and it has a leading role in management of policy change. The role of financial institutions in export financing is that of a cartelist and a committed broker. It ranges from assisting company and individual on how to enter export market through financing and handing shipping document and collect export proceedings.

Generally an export can meet his financing needs in the following number of ways.

  1. advance payment from overseas buyers
  2. internal general funds
  3. Credit from bank and other financing institution.
  4. Credit provided by the government in the buyer country.


It is regrettable that despite their various funding mechanism and incentives put by financial institution s to stimulate the growth of export in relative contribution to the economy is still very low because of this low rectum, financial institution face the risk of non-payment of loan and advance given to export.

Firstly, the problems of policy stability it is needless to formulate a beautiful policy on export only to be discontinued, shortly, example the re-introduction of regulatory guideline in domiciliary account was disincentives to the exporter. This was reverse later by central bank of Nigeria (CBN) circulated in September. After much pressure recently Nigeria export and import only provide fund and transfer the risk to other banks. Another problem is that Nigeria exporters who ventures into foreign market do not avail themselves with the information relating to import countries such as culture, regulation and wealth this result in low returns those by increase the risk being faced by the financial institution that finances them. The Nigeria through the activities of some of its citizen has activities of some of its citizen has developed a negative business image both at home and abroad the poor included.

Accommodation for a period of 3 days to 50 days, while long term credit usually related to a period of more than 5 years. The exporters need pre-shipment finance for security the raw material and other input required for the execution of an export also ranging from the shipment of goods to foreign countries the credit is therefore regards as a loan granted to finance goods on the bases of:

  1. Letter of credit open in favour of exporter by overseas. Imports bank.
  2. Insurance of ware House Company. The duration of such credit provided by the past does not usually exceed 12 days post shipment credit is a loan or advance granted or any other type of credit, provided by the bank to an exporter of goods from the date of export proceeds within today. The main types of advance for post shipment are negotiated form of export bill drawn with confound export contract will order.

The Nigeria export and import bank (NEXIM) provides both long and short term credit through commercial and merchant bank to support export from non oil product

  1. Advance fee fund syndromes popularly called 419

b, Cheating

  1. Supplying of poor quality product
  2. Manipulation of words and document

The practice sign through illegal export of goods especially to neigbouring west African Countries which cannot be over worked as a in habited factor. In view of there problems counters in financing export.


The purpose of this research work is as follows:

  1. To study the modalities adopted by export that need export assessing
  2. To determine the economy polices finance and their effectiveness on the export business

iii To ascertain the problems encountered by the financial institutions in export production finance.

  1. To examine the prospective of export financing in Nigeria
  2. To ascertain the extent to which oriented industries benefited from export financing.


The research work on the role of financial Institutions in export financing will be beneficial to the Nigeria economy in the following ways.

  1. GENERAL ECONOMY: It will help the nation in devising the foreign exchange and revenue of the nation as well as receiving pressure on the balance of payment
  2. MANUFACURERS: With the introduction of the structural adjustment program (SAP) in 1986, many manufacturers have been oriented into the system and hopefully manufactures export good with the financial institutions incentives will improve the production potentials as well as production producing large qualities of export purpose.
  3. EXPORTERS: The financing of export will go a large way in helping Nigeria exports to compete favorably with the international world.
  4. STUDENTS: This research work will be valuable to the students who may carry out the similar research work in related field for reference purposes.
  5. FINANCIAL INSTITUTIONS: The research work will work into the problems and the prospect of institution the export finance and the recommended ways to improve on it.


  1. Are the problems encountered by financial institutions in export financing in Nigeria.
  2. Are there modalities adopted by the financial institutions in assessing goods for exports?
  3. Has export oriented financial institution affected financial industries to an extent?
  4. Are there prospects of export financing in Nigeria.
  5. Are there difference economic policies adopted by the government to support export financing and their effectiveness on their export financing in Nigerian


HO: Export financing does not have prospect in Nigeria

HI: Export financing have prospect in Nigeria

HO: Modalities are not adopted by financial institution is assessing goods for export.

HI: Modalities are adopted by financial institution in assessing goods for export.

HO: Financial institutions in export financing in Nigeria does not encounter Problems.

HI: Financial institutions in export financing in Nigeria encounter problems.

HO: Export oriented financial institution has not affected financial industries to an extent.

HI: Export oriented financial institution has affected finance industries to an extent


The scope of the study is very wide it focuses on the roles of financial institution in export financing in Nigeria. As a result of this, the researcher has consulted with several reviews on the issues of the roles of financial institution in export financing in Nigeria which are appreciated for employees at a particular point in time. It also serves

as a useful guide to organizations. In their future decision making process on training related issues, knowledge of private sectors.


For the nature of the research work the researches Intended to limit its work because of the time of this research work the economic of the nation is also battered that the research cannot afford to visit all the financial institution and has a limited time.

  1. TIME FACTOR: The research has witnessed some months duration in season. However the researcher was able to utilize the available period

iii. WORK LOAD: The department worked load is numerous for the research work coupled with the fact that the researcher must attend lectures there by prevent a through and intensive work.


  1. EXPORT ORIENTATION GOODS: Goods produced with the sales intention of exporting them to countries in order to generate foreign exchange.
  2. FOREIGN EXCHANGE: Currency of other countries reserved in a given country.
  3. PRE-SHIPMENT AND POST SHIPMENTS: This is a loan granted to any credit granted by the bank to exporter of the date of extending the credit before and after shipment of goods to the date off receipt of exporter proceeds within 60 days.
  4. BALANCE OF PAYMENT: The relationship between a countries payment is form of a statement of income and a statement account on the international account.


  1. Ade, t. Ojo & wole A ,( 1982) Banking and Finance in Nigeria. Bedfordshire, Graham Burn.
  2. A. ( 25TH MAY, 1984) Development lending promoter Banking.
  3. Asuzu, C.C.N (1995), Element of Banking in Nigeria for Tertiary Institution; Ekwulobia: Theo Naruka & sons Publishers CBN (1990/1991).
  4. Chizea K. ( 21ST MAY, 1984), World Bank of Finance.
  5. Eboh E. ( 1983) Bank and industry in Depressed Economy the Billion Central Bank of Nigerian. 8. no. 4, p.12
  6. Nzeri U.C.(1985), Two phases of Banking programme in Nigeria.
  7. Nwankwo G.O. ( 1980), The Nigerian Financial System, Lagos Macmillan press Limited.
  8. Obo D.O ( 1983), Effect of Rural Banks on the operation of NNB Limited.
  9. Olalusi F. (1980) Introduction and Banking in Nigeria. Ibadan Published by University printing press Limited.
  10. Umahej ( 1985) “Monetary and Banking System in Nigeria” Benin, Idi Publishers Limited business Concord, Vol.2, No. 1 p.6 OKO Journal of Business studies Vol.1, p.24. Bank News April, June Vol. 5 No.26

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