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The contribution of saving and credit cooperatives (SACCOS) on the improvement of members‘ socio economic development in Rwanda: Opportunities and challenges

  • This study examines the contribution of saving and credit cooperatives (SACCOS) on the improvement of members‘ socio economic development in Rwanda: Opportunities and challenges‖, Evidence from Umwalimu SACCO- Huye District‖. The appearance of saving and credit cooperatives or credit unions has been known as remedy for social ills rooted in poverty because of its efficiency in loans or credits dispensation, social equality for enhancement and reduction of poverty amongst low income earners. Therefore, millions and millions of poor people and non-bankable in developing countries (or third world countries) have been provided access to formal financial services through saving and credit cooperatives‘ programs. The targeted population concerned by the study was 1,940 members of USACCO from which a sample of 92 respondents was purposively selected. The study has adopted a combination of correlation and descriptive research design. It has employed both quantitative and qualitative approaches. The study used both primary and secondary data. The primary data was collected using questionnaire and interview and, while secondary data was collected using documentations techniques whereby, Manual of procedures and Credit policies of USACCO and financial reports have been consulted. The analysis of data was done using SPSS version 21. The data was presented in form of tables, charts and graphs designed by SPSS v. 21. The bio-characteristics of respondents showed that, the majority of respondents were women with 55.4%, majority of respondents‘ age is between 26 to 45 years Furthermore, and majority 77.20% of respondents were married. 100% of respondents attended school, where the majority of respondents attended secondary school with certificate A2. The study has revealed that Umwalimu SACCO services offered to its members have a positive effect on the improvement of members‘ welfare. It was found that USACCO services have slightly affected income level of members, assets acquired, access to education and medical care as well as small income generating activities established by members in Huye District. The analysis of data also revealed that there are some variables which have effected USACCO members‘ socio-economic status, these were listed as: Education background of a member, number of dependents, the occupation of a member, and number of loans got from USACCO, government programs against teachers‘ welfare, and membership duration played very important role on the improvement of standard living of teachers. All these variables were found to have positive effects on teachers‘ socio-economic status, except the family size of respondents. In addition, the findings showed that, the majority of respondents confirmed that, they did not find opportunities to save with other financial institutions, and other respondents did not have access to loan from other financial institutions due to complicated loan requirements. In addition, after they have joined USACCO, their deplorable status somewhat changed, both socially and economically which has contributed to the improvement of their welfare. Therefore, the study testified that, the welfare of USACCO members in terms of assets acquired, income increased was improved compared to situation before joining USACCO. The study concludes that ―the level of improvement of living conditions of teachers depends largely to the level of loan granted by USACCO to teachers and membership duration. If the level of teachers‘ loan and saving increases, there will be also improvement of teachers‘ wellbeing‖ and finally, USACCO financial service is a veritable instrument for better improvement of economic and social conditions of teachers. The study recommends that, USACCO should provide frequent and regular trainings on business management game to their members. This could help members for good management of their loans and reducing loan defaulters‘ cases observed at USACCO. Challenges observed were lack of physical collateral security required by USACCO, complicated loan requirements terms and conditions and insufficient trainings on business management game.

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Author:Sylvain Robert Ntuite
Subtitle (English):Evidence from Umwalimu SACCO-Huye District
Advisor:Werner Sesselmeier, Kubon-Gilke Gisela
Document Type:Doctoral Thesis
Date of completion:2022/01/05
Date of publication:2022/01/05
Publishing institution:Universität Koblenz-Landau, Campus Landau, Universitätsbibliothek
Granting institution:Universität Koblenz-Landau, Campus Landau, Fachbereich 6
Date of final exam:2021/04/15
Release Date:2022/01/05
Tag:Loans; Saving
Microfinance; Microfinance institutions; Saving and credit cooperatives (SACCOs); Socio-economic development; Standard of living
GND Keyword:Lebensstandard; Mikrofinanzierung; Schulden; Sparen
Number of pages:xvi, 152, A-K Seiten
Institutes:Fachbereich 6
Licence (German):License LogoEs gilt das deutsche Urheberrecht: § 53 UrhG