Banking Sector and Hospitality Industry in Ondo State: Issues and Challenges
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Date
2016
Journal Title
Journal ISSN
Volume Title
Publisher
American Journal of Tourism Management
Abstract
The study examined banking sector and hospitality industry in Ondo state: issues and challenges. Hospitality
industry has remained one of the exciting and rewarding industries in Ondo state, but currently faced with a challenge like
unavailability of funds from the banking sector to fund the sector; while recent issue on economic recession presently
experienced in the country has further hindered the performance of the sector in terms of reduced local tourists patronizing
and the low profit being realized by operators. The banking sub-sector has remained the major funds provider via financial
intermediary process ensuring funds availability for the development of hospitality sub-sector (i.e. casinos, hotels, boarding
houses, motels, tourist camps, holiday centres, resorts, bars, cafeterias, snack bars, pubs, nightclubs etc., to owners (i.e. ether
individuals, group of people or corporate organizations). It was believed that sectors like, agriculture, energy, micro, small
and medium enterprises (MSMEs), oil and gas etc., enjoyed more finance assistance from banks than the hospitality industry
in Ondo state, Nigeria. The primary source of data adopted was via a structured questionnaire and interview. The statistics
that was adopted to estimate the parameter were mean, variance and standard deviation. Also, to determine the standard
error, δ√N was adopted. A simple regression was also used to address the responses of the respondents gathered though the
questionnaire in order to derive logical conclusion for the study. The result showed that the dwindling trends in the
hospitality sector was a result of banks’ restrictive lending patterns by not making funds (e.g. loans) available to achieve
development in the industry, unbearable cost of funds and high interest rate charged. The paper recommends that policy
makers should periodically evaluate the impact of bank - related policies on the sustainability of hospitality sector and ensure
that the hospitality regulatory process is simple, cost effective and consolidated with economic palliatives to proffer solutions
to socio-economic challenges facing the country particularly during this period of recession.
Description
Staff Publication
Keywords
Banking sector,, Hospitality industry,, Financial intermediation,, Restaurant,, Ondo state,, Nigeria