Discourse Journal of Agriculture and Food Sciences www.resjournals.org/JAFS ISSN: 2346-7002 Vol. 2(7): 203-216, July, 2014 Assessment of Performance of Thrift and Credit Cooperative Societies (CTCS) in Ikeduru Local Government Area of Imo State, Nigeria *Umebali, E.E1, Agu-Aguiyi FN, and 2Umuahia Godson, Comfort 1Nnamdi Azikiwe University Awka 2Michael Okpara University of Agriculture, Umudike, Nigeria *Email for Correspondence: [email protected]; Tel:+2348033165816 Abstract The research assessed the performance of thrift and credit co-operative Societies (TCCS) in Ikeduru Local Government Area so as to identify their contributions towards members' and host community well being. The specific objectives were to assess the volume of saving made by members in the last three years (2009, 2010 and 2011), determine the volume of loans disbursed and repaid within the period under consideration, identify problems which TCCS in Ikeduru L.G.A encounter etc. However, it was believed that thrift and credit co-operative societies started from Eastern part of Nigeria to which Ikeduru L.G.A belongs. Since then, TCCS has served as machinery of savings mobilization and funding of business to members who repay the loans with interest below the market rate. Data used for this study were collected from both primary and secondary sources. Primary sources of data were from oral interviews with the societies' Officers and administration of structured questionnaire to the members. While secondary sources include textbooks, academic journals, web pages on the internet and other reference materials. Five thrift and cooperative societies having a total population of 225 members were purposively selected for the study. Probability random sampling techniques were used to draw a sample size of 144 respondents who responded to and returned the questionnaire. The data were analyzed and three hypotheses were tested with Chi-Square (X2) statistical testing tool. Findings revealed that very few people (0.3% of the total population) in Ikeduru L.G.A were members of thrift and credit cooperative societies (TCCS). Aggregate savings from the five societies studied was enough to alleviate financial problems of the members although, some societies made very low savings within the period under consideration. The volume of loans disbursed were not enough for business expansion. Members do repay loans satisfactorily. The major problems facing TCCS in the area were overdue loans and inadequate capital. However, recommendations were made which include awareness campaign by the Divisional Cooperative Officers at the Local Government Area and TCCS organizations on the activities and advantages of TCCS in Ikeduru L.G.A. The societies should increase the volume of loans disbursed to members. They should in addition intensify efforts in loan recovery and engage capable management team to manage the business affairs of the societies. Keywords : Assessment, Thrift, Credit, and performance INTRODUCTION Thrift and credit cooperative societies (TCCS) are member-based organizations that help members to address economic problems. The ultimate goal is to encourage thrift among the members and to meet credit needs of people who might otherwise fall prey to loan sharks and other predatory lenders (Ledger 2004 in Adekunle et al 2007). Cooperative societies are widely spread organization in developing countries, they are known for strong commitment of, as well as participation in the decision making of their members (Haan et al 2003). These societies mobilize local savings and administer credit to members, thereby encouraging thrift and entrepreneurial activity (Adekunle, et al 2007). A cooperative society according to International Cooperative Alliance (ICA) 1995 is “an autonomous association of 204 persons united voluntarily to meet their common economic, social and cultural needs and aspirations, through a jointly owned and democratically controlled enterprise”. When first started, credit unions use relatively unsophisticated administrative practices, so that the cost are very small and most interest income from loans may either be distributed to the members or reinvested in the credit union within a capitalization programme. Consequently, (UNDESA 1999) has it that they can be set up in poor communities, where access to means of secure savings and to credit at non-exploitative terms is of greatest importance. Thrift and credit cooperative societies (TCCS) assure any group of individuals an effective means to combine resources, however small they further stated. It can exit among traders, farmers, craftsmen, artisan etc who pool their resources together to meet their common needs by means of regular savings passbooks in which his savings are recorded for keep. It permits a larger savings mobilization than within the capacity of most individuals. Financial intermediation through thrift and credit cooperative societies (TCCS) may be a catalyst for local entrepreneurial growth. The society retains capital and the surplus form outside transactions in the society within which it operates and is used for further entrepreneurial development. According to Erasmus (1994) in Adekunle et al (2007), cooperatives are a form of participatory, democratic economic and work organization in which members are simultaneously the owners, managers and workers. Credit is important element in any progressive and dynamic economy. As economic activities increase and economy becomes more diversified, credits become unavoidable. The unsurpassed solution is forn1ation of thrift and credit cooperative societies (TCCS) among close associates. They support entrepreneurial development because they have certain characteristic aid entrepreneurship. TCCS also in (Adekunle et al 2007), its characteristics include discretionary power of members, open communication, management suggests rather than instructs, risk and uncertainty are shared and there is motivational potential. Statement of the problem Ikeduru L.G.A of Imo State incident a lot of economic, social, cultural and political issues which every moment yearn for way out. High cost of living, environmental degradation, ecological problem, sickness, unemployment, underemployment, poverty, hunger etc exist in Ikeduru L.G.A. It is obvious that many people are financially and economically incapacitated are such can not engage in productive ventures or expand on existing business. As a result there is widespread of poverty brought about by poor business opportunities, low income, little savings, low investments and low productivity. Consequently, this situation has triggered a lot of social vices among which is child and women labour, kidnapping and drug addiction especially among the youths. Nigeria as a whole is not exempted as poverty and food shortage still ravage about 80% of its population of l40m (NPC 2006). Thus corruption, cost of finance and access to finance remain a significant challenge. The masses hardly benefit neither from the financial support from government support programmes nor commercial banks. The sources of start-up and growth finance, shows that their sources of funding were from personal savings. Daily Sun Wednesday, May 2, 2012 argue that loans for SMEs in Africa especially Nigeria are far more costly than in other developing countries. For instance, it was found that banks in Africa charge on average close to 15.6 percent for loans to their best borrowers while interest rates in other developing countries hardly exceed 11 percent. This makes access to commercial bank loans difficult. In order to alleviate poverty and reduce hunger by the year 2015 which constitutes the United Nations main goal on the Millennium Development Goals (MDGs) agenda. There is the Comprehensive Africa Agricultural Development Programme (CAADP 2010) Post-compact Technical Review for Nigeria. The purpose of the review is to enhance the quality of agricultural development and increase effectiveness of domestic and foreign development assistance for agriculture growth, food security and reduction of hunger and poverty Nigeria. The Federal Government through the ministry of Agriculture and Water Resources has developed the Nigerian Agriculture Investment Plan (NAIF). The vision of the programme is to ensure sustainable access, availability and affordability of quality food to all Nigerians and for Nigeria to become a significant net provider of food to the global community. Although double digit rates of growth may be feasible for Nigeria, the likelihood of achieving them in the near future is more problematic, considering that current growth trends hover around slightly higher than 5%. A realistic scenario of overall GDP growth rate of 7%, poverty levels would likely only achieve MDGI by 2015 (CAADP Technical Review Panel 2010). To achieve hunger, poverty and unemployment reduction a considerable private sector investment to which thrift and credit cooperative belong is required in research, technology development, efficient extension, credit and farmer capacity development to apply, adopt and adapt these technologies. Objective of the study The broad objective of the study is to assess the performance of thrift and credit cooperative societies (TCCS) in Ikeduru L.G.A of Imo State so as to determine their contributions to meet members' needs and community development. Other specific objectives are to: 205 - assess the volume of members saving made between 2009 and 2011. - determine if the volume of loans raised were not enough for business expansion. - ascertain