Oriental News a dedicated financial Online publication will be marking its 7th year anniversary with a review of the state of Nigeria’s financial sector.
It will be a publication of a well articulated review of banks, insurance, and experts opinions of contributions of the financial sector to national development.
We recommend that you be part of this epoch-making, interactive review.
We also call for contributions from experts in the sector to make the outcome rich and more interactive.
The publication will debut Monday, June 29, and will run till the end of July 2020.
Be part of this.
Preamble
The banking system plays an important role in the modern economic world as banks collect the savings of the individuals and lend them out to a business- people and manufacturers.
Interestingly, bank loans facilitate commerce.
Manufacturers borrow from banks the money needed for the purchase of raw materials and to meet other requirements such as working capital. It is safe to keep money in banks. Interest is also earned thereby. Thus, the desire to save is stimulated and the volume of savings increases. The savings can be utilised to produce new capital assets.
Thus, the banks play an important role in the creation of new capital (or capital formation) in a country and thus help the growth process.
Banks arrange for the sale of shares and debentures. Thus, business houses and manufacturers can get fixed capital with the aid of banks. There are banks known as industrial banks, which assist the formation of new companies and new industrial enterprises and give long-term loans to manufacturers.
The banking system can create money. When a business expands, more money is needed for exchange transactions. The legal tender money of a country cannot usually be expanded quickly.
Bank money can be increased quickly and used when there is a need for more money. In a developing economy (like that of India) banks play an important part as a supplier of money.
The banking system facilitates internal and international trade. A large part of trade is done on credit. Banks provide references and guarantees, on behalf of their customers, on the basis of which sellers can supply goods on credit. This is particularly important in international trade when the parties reside in different countries and are very often unknown to one another.
This make banks key to national developments. But how much have banks contributed to our national development?
All of these will form part of the review.