This is a comprehensive research work written by Miss NWANKWO AMALACHUKWU with registration number BK/N2003/197 on the problems and prospect of new generation banks in Nigeria
The research shows the activities of new generation bank, how they operate and how it improved in the rural area and business sector. Also how government restate the activities with various monetary police such as the minimum lending rate, acceptance deposit. And it treated the problems associated with new generation bank in Nigeria and recommended solution.



The banking act of 1960 defined banking as business. The business of receiving monies from outside sources as deposits, irrespective of the payment of interest, and the granting of money loans and acceptance of credits or the purchase of bills and cheque and sales of securities for accounts of others. Bank may define as any person or corporation, that provides the minimum banking services and which is licensed as bank by the federal government of Nigeria a banking institution.


The development of new generation bank in Nigeria can be traced back to merchant in the former west Africa colonies created, the need for locally base. Financial institutions for many has been replacing the old barter system, and the British silver currency was increasing used in business transaction, government and individual for investment. The need for new generation bank is to import these coins, distribute them and absorb any surplus.

Moreover, the story of financial institution in West Africa may be traced back to 1891, following an attempt imitated by the chairman of elder demister. & company, a shopping company which operated between West Africa and liver-pool.

In 1892, the Africa banking corporation was incorporated following by the bank of British West Africa in 1894 to serve the bankers aspiration of Nigerians. In 1916, the colonial bank was established and was take over in 1925, by Barcloys bank. Together with the Angjo Egyptian bank the national bank of South Africa, they were converted to the Barclays bank.


The government through C.B.N. has succeeded in persuading commercial banks to open up branches in new generation areas, to see how government polices are put to practice and to identify the problems encountered by these banks in the process of opening up branches in new generation bank in areas. The problems observed so far are.

1. Why the structural arrangement and management of Nigeria commercial bank as hindrance to the extension of bank services to new generation bank in areas?

2. Why manpower constraints?

3. Why poor infrastructural facilities and accommodation to this new generation bank?

3. Why the pessimistic attitude of bankers towards themselves has also contributed to the problems affecting the new generation banking programme?


The importance of this study is to find out if the rural population has become aware of branch banking in their communities. It is also to find out if the programme has achieved its aims of promoting and cultivating the banking habits, mobilizing rural savings, provision of credit for small-scale ventures and creating employment opportunities in the rural communities. There is also the need for deliberate policy monetary authorities aimed at strengthening the banks and the use of cheques in rural areas instead of demanding for cash.

This study will show how far the commercial banks have complied with the CBN guidelines on rural banking development.


The order to aid the understanding of readers, some of the terms used in the paper demand definition

RURAL AREA: the may be defined as any area in a state not designated urban area by the state government.

CROSS DOMESTIC PRODUCT: This is more often written and mentioned by economists in the short form, GDP, and it means the monetary equivalent of a country’s goods & services produced with a given period, usually a year.

URBAN AREA: urban area can be defined by the act as on area of a state designated as such by the state not so designated in a rural area.

RURAL DWELLER: This area the inhabitants of rural communities village and clans. They live in national and undefiled environment.

BANK: is any person or corporation that provides the minimum banking services and which is licensed as a bank by the federal government of Nigeria as a banking institution