Thursday, 28 July 2016

Problems And Prospect Of Cash Management In Commercial Banks

The concept of management was evolved as a result of existence of man. Hence, it could be traced back to the evolution of money. In this case, the origin of money which brings about cash management in our contemporary commercial backs really comes as the aftermaths of the difficulties of trade by barter. Trade by barter is a system and practice where goods are exchanged for goods and services. Barter system has many defects and drawbacks. These include the difficulty of double coincidence of wants, time and energy wastage, difficulty in ascertaining the value of commodities, discouragement of large quantities and variety of purchases, deferred payment, installment payment and borrowing large scale production and the likes.

Table of contents
cover page                                                                
table of contents                                                         

chapter one
1.1 introduction                                                  
1.2 statement of problem                                     
1.3 research questions                                                
1.4 objectives of the study                                   
1.5 research hypothesis problems and prospects of cash management in commercial banks                  
1.6 significance of the study                                
1.7 scope and limitation of the study                     
1.8 definition for key terms                                  
1.9 organizing/plan of the study                           

chapter two
2.1 literature review                                            
2.2 historical background of union bank of nig plc      
2.3 appraisal of cash management application                  
2.4 definition of cash management and motive of holding cash               
2.5 principle of cash management                                
2.6 instrument of cash management                     
2.7 monterrey policy                                           
2.7.1 instruments of monetary policy                    
2.7.2 factors of cash management                                
chapter three
3.1 research methodology                                   
3.2. source of data collection                                
3.3 sample size                                                           
3.4 restatement of research problem                   
3.5 data analysis and techniques                          
3.6 the design of the study                                  
3.7 the population of the study                             

chapter four
4.1 data presentation and analysis data presentation             
4.2. analysis of results                                         
4.3 discussion of result                                              
4.4 result relating to hypothesis testing       
4.5 policy statement                                           

chapter five
5.1 findings                                                              
5.2 conclusion                                                  
5.3 summary                                                              
5.4 recommendations                                          



Having identified the defects inevitable by barter system, people were forced to fashion out a generally acceptable means of exchange i.e. money. It is worthy to note that the paper money presently in use was originated from the receipt the goldsmith issued to people who kept gold and other valuables with them. As goldsmiths were taught to be honest, merchant people started keeping their gold with them for safe custody. In retain the goldsmith gave the depositors receipts promising to return the gold on demand. These receipt of the goldsmith were substitutes for money, such paper was back by gold and was convertible on demand into gold. This ultimately led to the development of bank note and today, money has another form other than paper called coin.

Thus, money is any thing that is generally acceptable as a medium of exchange for making payment, settlement of debt or other business obligations. The qualities of money such as generally acceptability, portability, durability homogeneity, divisibility, recognizability and scarcity make money and prudent management. Paper money and coins are collectively called cash. Today, customer deposit money with banks and banks give a promise to pay on demand the amount deposited by the customer. The customer can withdraw all his or her money in cash for the purpose of settling his or her debts or he or she can issued cheque by asking the bank to transfer the stated sum form his deposit to beneficiary.

In course of the study, the research is centered on ineffective cash management in our country’s commercial banks with particular attention to Union Bank that which deprives our country’s banking industry of competing with banks of developed countries of the world.

The following recommendations are suitable for the solution to the problems of cash management.
i.There should be experienced and honest personnel employed into the bank for effective and efficient management of cash.
ii.The idle balance should be properly invested in economy income.
iii.There should also be supervisor and implementation of loans by banks so as to ensure that the loan is well utilized for the intended purpose.
iv.Cash inflow and outflow overtime period should be adequately prepared and adhered to.
v. Adequate supervision to branches without notice should be undertaken to ascertain that they operate in efficient way to improve cash management.

This paper intends to find answer some questions so as to achieve its objectives and for the purpose of this research work. The question are as follows;
i.      What are the saving services of the banks and their operation?
ii.      What are the native of operation of the bank?
iii.     What are the conditions to grant loan and on what type of collateral do you grant loan?
iv.     How does cash manager meet the demand of the deposit and the shareholder?
v.     What is the policy of bank on the shortage or surplus declared by the central banks?
vi.     Does your bank has any has investment in other bank or industry?


The main objective and aim is to examine the problems and the suggested prospects of cash management in commercial banks. It also aims to attain the following objectives.
-  To meet payment schedule.
-  To minimize the finds committed to cash balance.
- To proffer strategies techniques to ensure efficient cash management as this could by the commercial banks as modem financial organization.
-  To determine the appropriate target cash balance.
-  To determine how cash can be manager efficiently and effectively.

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