A survey of banking institutions and their potential role in the allocation of resources for development in Africa

Abstract

A basic problem of resource mobilization is how to turn domestic resource mobilization into an engine of growth and structural transformation. It has been asserted that financial institutions can help overcome the capital shortage problem and, thus, influence the pace and pattern of development. Thus, the rapid development of a country's financial system will be instrumental to enhancing the growth process via its influence on the capital stock for growth purposes. In the case of African economies, it has been observed that the structural rigidities of their economies and their limited capacity at financial intermediation are among the factors that have hampered and continue to hamper domestic efforts at resource mobilization for development. This study focuses on financial intermediation or the role of financial institutions in tapping and equilibrating the demand and supply of resources as between deficit and surplus units, with particular emphasis on banking institutions.