An assessment of the role of commercial banks in promoting trade in rural areas: case study BPR S.A Kaduha sub-branch

LIST OF TABLES

Table 4. 1: Commercial activities that the traders got bank loan to finance 234

Table 4. 2: The amount of credit that traders got from BPR S.A Kaduha sub-branch 235

Table 4. 3: The period after which the customer gets loan from the date of application 236

Table 4. 4: The agreed period of loan repayment 237

Table 4.5The period in which the traders repaid the loan 237

Table 4.6: The factors that help customers respect the agreed period of loan repayment 238

Table 4.7: Respondents' opinion on the extent to which the bank loan is helpful in financing trade 239

Table 4.8: Respondents' opinion on credit services offered by of BPR S.A Kaduha sub-branch 239

Table 4.9: The reasons of increase of the sales volume after getting the loan 240

Table 4.10: The rate in which the tax paid increased after getting the loan 241

Table 4.11: The novelty of the business in the area after getting the loan 242

Table 4.12: The performance of the business after getting the loan 243

Table 4. 13: Impact on the bank loan on the employment 243

Table 4.14: The bank loan and the improvement of standards of living 244

Table 4. 15: The amount that the customers could request for after the loan repayment 245

TABLE OF CONTENTS

DECLARATION i

DEDICATION ii

ACKNOWLEDGEMENTS iiiii

LIST OF ABBREVIATIONS iiiv

LIST OF TABLES iiv

TABLE OF CONTENTS iivi

ABSTRACT iix

CHAPTER ONE: GENERAL INTRODUCTION 21

1.1. Background to the study 21

1. 2. Problem statement 2

1.3. Objectives of the study 23

1.3.1. General objective 23

1.3.2. Specific objectives 23

1.4. Hypothesis of the study 23

1.5. Significance of the study 23

1.6. Scope of the study 23

1.7. Organization of the study 24

CHAPTER TWO: LITERATURE REVIEW 25

2.0. Introduction 25

2.1. Commercial Banks 25

2.1.1. Organization of a commercial bank 26

2.1.1.1. The owners and policymakers 26

2.1.1.2. Senor management 27

2.1.1.3. The credit division 27

2.1.1.4. Finance division 27

2.1.1.5. Operations division 27

2.1.1.6. Trust division 28

2.1.2. The goals of commercial banks 28

2.1.3. Internal and external factors affecting the earning of commercial banks 28

2.1.3.1. External factors 28

2.1.3.2. Internal factors 29

2.1.4. Activities of Commercial Banks 29

2.1.5. Commercial bank credit 29

2.1.5.1. Types of credit secured by commercial banks 210

2.1.6. Benefits of commercial bank activities for the economy 212

2.1.7. Commercial banks in Developing Countries 213

2.1.8. Problems faced by commercial banks in Rwanda 213

2.1.9. Financial intermediation in rural areas in Rwanda 214

2.2. The concept of Trade 216

2.2.1. Types of trade 217

2.2.1.1. Electronic trade 217

2.2.1.2. Commodity trade 217

2.2.1.3. Barter trade 217

2.2.1.4. Retail trade 218

2.2.1.5. Wholesale trade 218

2.2.1.6. External trade 219

2.2.2. Trade and Rwandan development 219

2.2.2.1. Constraints of the Trade Sector 219

2.2.2.2. Opportunities of trade sector 221

2.2.3. Rural areas towards internal trade 223

2.2.4. Strategies of promoting internal trade 223

2.2.5. Rural trade and development in Rwanda 224

2.2.5.1. Poverty in rural areas 224

2.2.5.2. Financing trade and rural development 224

2.2.6. Barriers that restrict the ability of households to move into commercial activities 225

2.2.6.1. Lack of access to credit 225

2.2.6.2. Lack of organization of the rural sector 225

2.2.6.3. Lack of access to energy 226

CHAPTER THREE: RESEARCH METHODOLOGY 227

3.1. Introduction 227

3.2. Population, sample, and the sample determination 227

3.2.1. Population 227

3.2.2. Sample and sample selection 227

3.3. Source of data 228

3.3.1. Primary data 228

3.3.2. Secondary data 228

3.4. Data processing 229

3.4.1. Editing 229

3.4.2. Tabulation 229

3.5. Data analysis 229

3.6. Hypothesis testing 229

CHAPTER FOUR: DATA ANALYSIS AND INTERPRETATION 230

4.1. Introduction 230

4.2. Description of the area under the study 230

4.2.1. The history of the Banque Populaire du Rwanda S.A 230

4.2.2. Mission and vision of Rwanda People's Bank 231

4.2.3. Objectives of Banques Populaires in Rwanda 231

4.2.4. Historical background of BPR SA Kaduha sub-branch 232

4.2.5. Objectives of BPR S.A, KADUHA SUB-BRANCH 232

4.2.6. Vision of the BPR S.A KADUHA Sub- Branch 232

4.2.7. Principal activities of BPR S.A KADUHA Sub-Branch 233

4.2.7. 1. Activities of Savings 233

4.2.7.2. Activities of the credit 233

4.3. Analysis of data from the respondents 234

4.3.1. Analysis of information relating to the commercial activities financed by BPR S.A Kaduha sub-branch 234

4.3.2. Respondents' view on credit services offered by BPR SA Kaduha sub-branch 235

4.3.2.1. Amount received as credit 235

4.3.2.2. The period after which the customer gets loan from the date of application 236

4.3.2.3. The agreed period of loan repayment and its respect 237

4.3.2.4. Respondents' opinion on the extent to which the bank loan is helpful in financing trade 238

4.3.2.5. Respondents' opinion on credit services offered by BPR S.A Kaduha sub-branch 239

4.3.3. The performance of commercial activities supported by BPR S.A Kaduha sub-branch 240

4.3.3.1. The impact of loan on the business 240

4.3.3.2. The impact of loan on the tax paid to the Government 241

4.3.3.3. Respondents' opinions on the novelty of the business in the area after getting the loan 242

4.3.3.4. The performance of the business after getting the loan 242

4.3.3.5. The impact of the bank loan on the employment 243

4.3.3.6. The bank loan towards the standards of living for the traders 244

4.3.3.7. Respondents views on the future loan application 245

CHAPTER FIVE: SUMMARY, CONCLUSION AND RECOMMENDATIONS 246

5.1. Introduction 246

5.2. Summary 246

5.3. Conclusion 248

5.4. Recommendations 248

5.5. Suggestion for further research 248

BIBLIOGRAPHY 249

APPENDICES 251