An Assessment Of The Role Of Rural Saving And Credit Cooperative Societies In Improving Members’ Agricultural Production In Gobu Seyo Woreda, East Walega Zone, Oromia Regional State

Abstract

Savings and credit cooperatives societies (SACCOs) are voluntary financial organizations that are owned and operated by members. Their purpose is to encourage savings by creating a local deposit and then using the pooled funds to make loans for productive, consumer, or social purposes to their members. Rural savings and credit cooperatives societies operate as farmers’ grassroots organizations, aimed usually at meeting the seasonal financial needs of their members, which other financial institutions do not satisfy. This research is conducted to assess the roles of rural savings and credit cooperatives societies in improving member agricultural production in East Wollega zone Gobu Seyo Woreda, in the case of Wirtu Gembela and Gudetu Hara primary savings and credit cooperative societies. Both primary and secondary data sources that combine qualitative and quantitative data known as the mixed research approach was used. The investigator used the multi-stage sampling design to select sample districts, cooperative societies, and member respondents. And also used questionnaires, interviews, and personal observation to collect the data. Accordingly, the collected data was analyzed through exploratory, descriptive statistics, and ordinal logistic regression models. Agricultural production was measured as the total amount of yield for the four crops i.e. Maize, Teff, Niger Seeds, and Finger Millet. Total agricultural production of fewer than 150 quintals was categorized as low, total agricultural production between 150 and 200 quintals was categorized as a medium, and total agricultural production of more than 200 quintals was categorized as high production. The data collected about the existing contribution of RUSACCO to improve members' agricultural production from the year 2010 to 2012 showed an increasing trend in membership size, amounts of savings deposited, the number of shares issued, amounts of credit given, and loan repayment, and numbers of borrowers members. This shows that the RUSACCOS played a significant role and has a good contribution to enabling the farmer members to improve their agricultural production. Finally, the results of the chi-square test and Ordinal logistic regression model shows that the total agricultural production had a significant relationship with the amount of dividend paid, loan disbursed, annual income, current saving, and current share of the respondent, and the amount of different agricultural input used for production purpose. The remaining variables show no significant relationship with total agricultural production. Based on the findings of the research, the researcher has recommended certain recommendations that he thought to be very critical if considered and implemented by the Saving and credit cooperatives societies accordingly and properly. Therefore, the following recommendations have been given; Improve Cooperatives’ Access to Financial Capital, Training to office bearers and education to members on their specific needs, Government support to cooperatives, Efforts in building leadership and governance capacity, and Changing the Attitude toward Women towards their Cooperatives (gender