An Analysis Of Loan Default In Nigeria Agricultural Co-Operative And Rural Development (A Case Study Of Nacrdb Nkpor Anambra State)

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Project and Seminar Material for Cooperative Economics and Management (CEM)

Project and Seminar Material for Cooperative Economics and Management (CEM)


First of all, I dedicate this work to the Almighty God for His infinite mercy to the possibility of this project and for His guidance and protection towards me during this my academic pursuit.

I also dedicate this work to my lovely parents Mr. & Mrs. B.C.N. Duru for the financial support and encouragement to ensuring that I have a sound academic up bring in life.


I acknowledge my family members for their love and support throughout my staying in school.

Also, I acknowledge the effort of my supervisor (Mr. Mike Okonkwo) for correcting and guiding me throughout this project writing.

My great thanks goes to the staff and members NACRDB (Nigeria Agricultural Co-operative and Rural Development Bank) Nkpor, for assisting me in my research work.

Thank you all. 


The research analyzed the loan default in Nigeria agricultural co-operative and rural development bank (NACRDB). This bank finances all forms of co-operative societies and small-scale industries. This aimed at knowing the extent of NACRDB loan administration programme and the extent it has accomplished the objective of its establishment. Most co-operative societies are not aware of the NACRDB loan scheme.

Improper loan disbursement and low supervision has contributed not render the necessary assistance to the loaned in terms of advice and training. These are the result from questionnaires.

Based on the finding, the following recommendations were made:NACRDB should ensure efficient disbursement of loan, they should create awareness for their loan scheme, they should arrange proper programme for the loaned appropriate supervision of the loan to avoid loan diversion if necessary, they should assess aspire to give the loaned both the business and technical advice needed. All these are aimed at efficiency to reduce the rate of loan default.

Table Of Content

  • Title
  • Approval page ii
  • Dedication iii
  • Acknowledgement iv
  • Abstract vi
  • Table of content viii

Chapter One

  • 1.0 Introduction 1
  • 1.1 Background of the Study 1
  • 1.2 Statement of the Study 3
  • 1.3 Objective of the Study 5
  • 1.4 Research Questions 7
  • 1.5 Significance of the Study 5
  • 1.6 Scope of the study 8
  • 1.7 Limitation of the study 9
  • 1.8 Definition of terms 10

Chapter Two

  • 2.0 Literature review 12
  • 2.1 The Meaning of Co-operative Society 12
  • 2.2 The objective of the NACRDB13
  • 2.3 The organizational structure of NACRDB 15
  • 2.4 Types of loan issued by NACRDB 18
  • 2.5 Procedures for securing loans recovery 23
  • 2.6 Causes of loan default 36

Chapter Three

  • 3.0 Research Methodology 42
  • 3.1 Types and sources of data 42
  • 3.2 Research design 43
  • 3. 3 Population and sample size 44
  • 3.4 Sampling Techniques 45
  • 3.5 Validity and reliability of measuring instrument 45
  • 3.6 Method of data analysis 46

Chapter Four

  • 4.0 Data presentation and analysis 47
  • 4.1 Presentation of data tables 48

Chapter Five

  • 5.0 Summary of findings, conclusion and recommendations 67
  • 5.1 Findings 68
  • 5.2 Conclusion 69
  • 5.3 Recommendation 70
  • References 72
  • Appendix 74
  • Questionnaire.

Chapter One

1.0 Introduction

1.1 Background Of The Study

In 2001 Nigeria in the quest to offset debt crises of economic problem mapped out specialized banks primarily set to entrance investment in agriculture and finance macro and micro credit especially within the rural communities. Such banks are Nigerian agricultural co-operative and rural bank (NACRDB) development banks, industrial bank, and mortgage banks. They grant loans to small holders and large investment holders. These banks were designed as an avenue to get in contact with numerous farmers and business investors at the grass roots level. Nigerian agricultural co-operative and rural development bank (NACRDB) is aimed at financing basically agricultural co-operative and other co-operative societies in the small scale business.

The research for the recovery of loans from clients include:lack of trained and experienced personnel in agricultural financing and loan administration on most of the commercial and merchant banks default in loan repayment resulting from poor project appraisal or management as well as outright unwillingness to repay by some borrowers, also problem related to settlement of loans is caused by the bank to file claims in accordance with procedure and passion stipulated by the banks, improper loan disbursement and poor supervision. Another problem could be caused by delay in approval due to low capital base on the banks as a result of inflation in the economic. This delay may lead to misappropriation of funds which might eventually lead to losses.

The observed trend is that Nigerian Agricultural Co-operative and Rural Development Banks and other financial institutions are experiencing a high level of loan losses each year due to the shortcomings indicated earlier. This is the obtaining at an insight into the problem of loan recovery and offering adequate and requisite suggestion.

This is the main reason why analysis of the loan default in Nigeria agriculture Co-operative and rural development banks (NACRDB) with the view of obtaining an insight in to the problem of loan recovery and offering adequate and requisite suggestion.

1.2 Statement Of The Problems

Special banks have been set up in the country to advance loan and credit for development purpose. Incidentally these banks have always find it difficult in recovering the advanced loans especially NACRDB which is the focal point of study. In problem of credit recovery by these banks, it can be seen to range from lack of collateral. Commitment, lack of trained and experienced personnel in agricultural financing and loan administration, to the default in loan repayment negotiation, poor project appraisal or poor project management, as well as simple uncollingness of the borrower to repay borrowed money, equally seen as a problem towards loan recovery is whether the bank supervised the loan given to the borrowers, the inadequacy of the funds guaranteed in an inflating economic as well as low capital base ion the funds and finally difficulties associated with the deregulation of the financial market and distress of the banking industries in “go” which reduced the interest to participate in NAERDB’s operations, against these established shortcomings, the work will methodically study these areas of shortcoming and suggest the solutions to the problem, for future guide against credit and loan defaults by NACRDB to the prospective customers.

1.3 Objectives Of The Study

The general objective of this study is to analyse loan default in Nigerian Agricultural Co-operative and Rural Development Bank (NACRDB).

The specific on objective of the study include:

  1. To find whether or not co-operative societies secure loan from NACRDB.
  2. To determine the condition for such loans.
  3. To determine and examine the factors responsible for the loan default.
  4. To determine and find out the problems that affect the organization in loan administration.
  5. To find out the credit burden of such loan.

1.4. Significance Of The Study

This study well expose the ways by which loan default in co-operative movement. It is very big significant part from stimulating and paving way for further studying of this area, it will also provide a clear standing of these defaults and growth affecting NACRDB. And it will also expose how good management loan can bring about greater happiness among co-operative co-operators, co-operative bodies individuals, all loaned and NACRDB Nkpor Zone.

This work has emanated from the performance of the co-operative credit institutions, especially the NACRDB Nigeria Ltd. Its purpose is to help provide a true and objective position of NACRDB Nigers Ltd. In that process, the following will be critically looked at:

  1. There findings will help enable us to appreciate the contributors the NACRDB has made so far in the general economic and industrial development of Nigeria especially as regards in financing of co-operative societies.
  2. It will also guide co-operative societies in tackling the various credit financing problems facing them and make full utilization NACRDB.
  3. The study will also help those who may have need for further research on the financing of co-operative societies by development banks.
  4. The findings will also help to make recommendation and suggestions for further improvement of the present situation.
  5. Lastly, the work will be useful in addition to the existing research work, in the area of loan disbursement and recovery in our country and hence will serve as a reference to further researchers.

1.5 Research Questions

  1. To what extent are loan disbursed to Agricultural Co-operative Societies by NACRDB in Nigeria?
  2. How regular is the loan disbursed to Agricultural Co-operative Societies in Nigeria?
  3. What are the interest rates on loans disbursed to Agricultural Co-operative Societies in Nigeria?
  4. At what rate do Agricultural Co-operative Societies repay their loans to NACRDB?
  5. What is the extent of loan default by Agricultural Co-operative Societies in Nigeria?

1.6 Scope Of The Study

This study covers the operations of NACRDB Nkpor Zonal Office with regards to its loan disbursement and recovery. It looks at the operations of the banks in granting financial assistance to co-operative societies who are the users of fund to ensure their investment. It also talk about how the NACRDB will uplifted to avoid failure in the society, with this it will enable the co-operative society to grow higher than expected with the help of the financial assistance.

1.7 Limitation Of The Study

Apart from these, NACRDB like any other organization has a secret nature of handling its official document. Hence they could not provide enough data as required by the researcher for instance, the staff of NACRDB could not let out any unpublished data that is newly documented with regards to their operation. Therefore there is no doubt that it has some limiting impact on collecting a sufficient data because time and money were the greatest problem encountered in this research work as a student. The research (i) have to make use of the little information provided by the NACRDB. Also there is this difficulty in obtaining enough information from individual borrowers on the amount of loan given to them each year.

1.8 Definition Of Terms

For the purpose of this study, it is useful to make clear meanings at some major terms used specially for the purpose of the study such as terms are as follows:

Loan Able Funds:

Loan able funds are money available for lending in financial market, the loan able fund theory holds that the rate of interest is determined by the force/rate of demand and supply of loan able funds in the capital market,


This means the registrar of Co-operative Societies appointed under an appropriate section of co-operative law of any state or country and he can also be a person who is exercising such power or a registrar, as may have conferred on him under Co-operative law.

Loan Interest:

It is a portion of surplus value which an industrialist transfers to the bank or finance house as payment for using its loan.

Credit Facility:

This is that which is meant to enable the beneficence to generate additional income which will in the long run time to attain reliance.

Self Reliance:

Ability to verify oneself for survival and continuous development rather than relying on others.


Conveyance of property like lands and buildings to a creditor as security for acquiring loans.

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How to nail it on the head during your project / seminar defence

You are through with writing that project / seminar. Now what?

You have found yourself at that point where you have to defend what you have written. Of course you have to stand in front of your supervisor and other literary personalities to prove that you know what you wrote in your project paper. Unfortunately, the more you think about it, the more it looks like you are about to face a legion. It is not a war. But the emotion of dread welling up inside of you makes it look like one. So now you are asking yourself questions.

  • How am I going to start?
  • I hope I will do well enough to get an A.

You really want to nail it, but you need to come to terms with exactly how to get everything in perfect control. Especially your emotions of fear that seem to make a wreck of you every time you think about public speaking.
So here is the deal. I want to help you avoid that feeling that would ruin your precious moment if you dare to let it. And we are going to do it together.

I am going to highlight some very important tips to help you get in control for you to be comfortable enough to move from that feeling of DREAD to CONFIDENT; and making an awesome Impression for that great rating your supervisors should be giving to you so freely.

Consider these tips as you prepare for your defence. We will be taking them one after the other so here we go.

Watch Your Body Language And Keep It Confident:

Can you tell that a person is falling apart if they look confident? … If I can second guess you rightly, am sure you answered no to that question. Remind yourself that you need to come out that way. Now this might seem like a huge big deal when you are dealing with the foreboding. Maintaining a poise of confidence is very important. So find your most comfortable position, sitting or standing and draw up your body. You must exude confidence. It is something you need to do for yourself. People can only see what you allow your body language to show. So you must endeavour to put that out. Remember the story of David and Goliath? … At the end of your defence day, you want to be David.

Dress In Your Most Comfortable And Impressive:

Am sure this one is a no brainer. However I must highlight that you choose comfortable pieces. You don’t want to look so good and yet look like you were forced to wear something that does not belong to you. It’s great to ensure that as impressive as your clothes are on you, that they are also very comfortable.

Speak With Authority:

Going hand to hand with that aura of confidence is your most powerful asset:your words. If you look that confident, your words must not come out like whimpers. To be able to pull this off, you definitely need to speak as deliberately as possible in expressing yourself. Let them also hear what they see.

Use, Your Gestures:

I have often found this to come to my rescue in dealing with shyness and conveying my confidence. Usually it gives you an edge to also drive home your point. You must, however, ensure that you do not over use it. It doesn’t mean that your hands should be flying all over the place. That would be absolutely unnecessary. If you do this well, after a while you will realize that you are not as self-conscious as you used to be at the very start. For most situations, it would have completely disappeared altogether; leaving a really confident you talking.

Have A Good Opening And Closing Line:

Make sure you have perfected a good opening line. You should also be armed with a good closing line too. Try and rehearse it to a friend. If for the first time you presented it, your friend does not say “wow, that’s beautiful” or something like that; just know you need to keep refining it until you get the perfect line. Both opening and closing lines will go a long way in how impressed your panel gets to rate you high.

Make Sure You Know Your Work:

Certainly you should understand how important it is to know your own work from start to finish. Not having in-depth knowledge of your own work is tantamount to a suicide mission. Why should you kill yourself?
When all is said and done, this is what you came to defend in the first place. You should know your work from A to Z.

Prepare For The Questions:

Now this part is truly essential. You must be sure you do not floor all the good work you did on your presentation by not answering correctly. You must pay attention to the questions you are asked to be sure you will give the right answer. Many people get it wrong at this stage and spoil their good presentation. When you do not understand any question do endeavour to ask the person to expatiate what they mean before you answer.

These tips are by no means exhaustive, but applying these tips will give you some necessary advantage you need for a great outcome. Of course that outcome would mean that you eventually earn all your points on this project.

The structure of a good project work

Undergraduate projects in Nigeria is a prerequisite for graduation amongst Nigerian tertiary students who will which to obtain bachelors degree in their respective courses of study such as accounting, banking and finance, business administration and a host of others. Writing an undergraduate project in Nigeria for final year students entails a lot both financially and otherwise. Being able to develop any final year project depends on getting a researchable topic whether it is Accounting Undergraduate project topics, Banking and Finance research topics or banking and finance project topics and materials and it all requires diligent hard work of students who are willing to develop best undergraduate projects in Nigeria and graduate in flying colors.

A typical Undergraduate project in Nigerian tertiary institutions can be said to be divided into five or six chapters depending on the format of the school and course of study which are

1. Introduction

The introduction of an undergraduate project states the main research problem and research argument. What precisely the study is all about and why it is important. It looks at the originality of the research work and how it will fill the gap in other studies. Justification for a research undergraduate topic should not be lengthy before it has been explicitly stated.

Below are the contents in chapter one of an undergraduate research project which includes;

  • Background of the study,
  • Statement of the problem,
  • Objectives or aims of the study,
  • The research questions,
  • Research hypothesis,
  • Significance of the study,
  • Scope of the study,
  • Limitations of the study and
  • Operational definition of terms.

2. Literature review

Literature review of any undergraduate research work, be it business administration project topics or Economics project topics just to mention a few is very critical to securing a high grade in one’s project work. The literature review of a research process uncovers what other writers have written about the student’s topic. A student’s undergraduate research work should include a discussion or review of what is known about the subject and how that knowledge was acquired. The review could conclude with a brief summary of the literature and its implications. The contents of the literature review are the theoretical review, conceptual framework, empirical review and summary of literature review.

3. Research Methodology

This section includes a description of the research methods used in the undergraduate research work such as the sample size, data collection methods, measurement instruments, research data analysis procedures and the population from which the sample was selected.  This section also describes the method used in selecting the sample or samples, validation and reliability of the instruments used in the research work. There are different research statistical techniques used in undergraduate research work such as SPSS, e-views etc.

4. Results & Discussion

This section presents and discusses the data analysis results used in an undergraduate research work, the results of each analysis is being summarized, tabulated, and then discussed for each research question.  Then for each research hypothesis, the statistical test of significance selected and applied to the data is briefly described, followed by a statement indicating whether the hypothesis was supported or not supported.  In presenting the result analyses/summary in an undergraduate project tables and figures and or graph are used to add clarity to the presentation.

5. Summary, Conclusions And Recommendations

This section summarizes the findings of the study in an easy to understand manner.  It also explains the practical implications of those findings, and points to recommended directions for future research in that area.


This is where every source cited in the undergraduate research work is being included. Every undergraduate research work must be properly referenced for its authenticity.

Choosing A Good Project / Research Topic

Students in Nigerian universities these days wish to choose a very simple project topic/material. There is no issue choosing a simple project topic; the only problem is your ability to choose a good project or research topic that your supervisor will easily approve for you.

Most project supervisors really want to see how good his or her project student understands his or her surrounding through the kind of topic he or she chooses for their project work.

There are some project topic that are not reject-able; for instance in Nigeria of today; what do you think is the major issue on ground now?

If a project student can choose or craft a topic on the effect of dollar increment on the economy of Nigeria. Such project topic will be very interesting to write on.

Now what are the qualities of a good project topic?

  1. The materials for the project topic must be easily assessable.
  2. The project topic itself must be meaningful.
  3. The variables must be able to give a clear aim of the project topic.

What do I mean by variable?

Well I am deriving my point from the area of project writing; the variables here are those main words in the project topic.

Like the above project topic; the effect of dollar increment on the economy of Nigeria. You can see the main variables that really define this project topic are:dollar, increment and economy.

Before you present your topic to your project supervisor, first of all understand your project topic, and then secondly try to do some research for your topic to see if at least you can get up to 60% of what you need to write the complete project.

I said that above because you might have a very nice topic that the materials are not available online and there are no books as regard the topic; in this case the project topic becomes difficult for you even though the topic is catchy.

What do I mean by your topic being assessable?

Well what I mean is very simple and easy to understand. Simply pick your project topic, type it on google and see if you will have at least a good background for the topic you are writing on.

If you can have a good background for your project topic and you can understand the problem associated with the project topic, then I believe the aim of the project is not far-fetched.

Structure of a Seminar Paper

I feel like there is a lot of stress out there among grad students about writing seminar papers, especially when we’re told that our goal should be to make an original contribution to the field. That idea can be quite intimidating when we’re just starting out. It feels like you’ve asked us to jump off the deep end of the pool and we don’t know how to swim.

I think part of the problem is that we’re still working out how to structure seminar papers.** Each paper we write is another step closer to a successful, effective, and effective paper; however, we’re still flailing our arms (and other miscellaneous body parts) around because we’re uncertain of exactly how to go about it. I realize, of course, that there is no one right answer. However, below is my suggestion at sticking your toes in the water.

Section #1 — Introduction

Provide a little bit (or a lot) of motivation for the reader to read your entire paper. Failing that, your reader should know what the paper is going to be about by reading your introduction.

Paragraph #1 — Get some attention.

  1. Provide a context by citing a recent text in the field — the point that is cited may or may not be the main point of the text — it is what jumped out at you.
  2. Set-up broader context of what you’re going to do

Paragraph #2-?? — Define issue and the gap.

  1. Define issue and any key terms
  2. Limit scope as necessary
  3. Establish significance of issue
  4. State problem by defining the gap
  5. Explain how present research attempts to fill the gap
  6. Outline contributions (readers will see lit review for more detail.)
  7. End with thesis and preview organization of the rest of the paper

Section #2 — Literature Review

Give some credit where credit is due.

  1. Indicate the current state of the issue/problem/topic
  2. Define or qualify terms
  3. Engage sources in conversation with each other (don’t just copy in annotated bib)

Section #3 — Argument / Discussion

As stated in the Allyn & Bacon Guide to Writing:wallow in those complexities!!

  1. Examine issue
  2. Argue how issue can be mitigated, mediated, or mashed
  3. Provide evidence and support
  4. Make some lively commentary along the way

Section #4 — Conclusion

We’re almost done. Don’t quit now.

  1. Summarize research question
  2. Qualify argument/discussion if you need to
  3. Explain where we go now
  4. End well

Section #5 — Works Cited

Double check

Is everything listed on the works cited?

Tips: it’s ok to use sub-headings to keep yourself organized.

Tips On How To Know What Your Supervisor Is Looking Out For In Your Project

Apparently all schools/colleges ask their undergraduates especially the final students to write their final year project before they are certified to be graduates. These projects are mostly discovery activities geared towards problems solving or basically to make new discoveries or better still have a better understanding of a problem with the aim of proffering better solutions.

With this assigned task an undergraduate will need an advisor, a counselor or a supervisor to guide and direct this activity for a desired result and a successful ending and of course, in return the supervisor have factors to look out for in a student project, so that the aim of the project writing will not be defeated.

As a final year student planning to write your final year project, there are some factors you need to consider when trying to have a good working relationship with your supervisor and you must have the below tips at your fingertips to know what your supervisor look at for in your project.

Selecting the right topic or title:

The supervisor would want to know how knowledgeable one is, in a chosen topic and how far one can go with the topic by asking one diverse questions which could be simple or a bit tough. So one thing is to choose a right topic and another thing is to be knowledgeable about the said topic.

The relevancy of the project topic to the degree course:

This is one of the important things a supervisor looks out for in a project. A final year project must have a purpose and objectives and most importantly be problem solving and must be related to the course of study. So a project topic should be relevant and interesting.

The realistic plan for the project:

A project supervisor will always look at how realistic a project topic is. Will the project aims be achieved and at the specified time. If it will outlived the specified time such topic might be dropped and a new topic adopted to run the set time and fulfill its purpose.

Quality of research materials available:

Another factor a supervisor will consider in project writing by a student is the quality of the materials available for research on the chosen project topic, can materials and information be readily available and are those materials of high standard and convincing not just bogus and fictitious analysis but materials that research has be carried out by scholars related to course of study. So a source of materials used for a project is very important and most supervisors look out for this.

The funding channels:

Almost all project writing needs a good amount of funding to achieved the desired aim, A supervisor would always want to find out how the project will be funded, so as not to have hitches when the project is on. So to have a smooth working relationship with ones project supervisor, the funding of the project must be considered and revisited from time to time. Because a supervisor will look out for this aspect too.

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