Assessment of the Performance of Saving and Credit Cooperatives: The Case of Hawelti Sub-city, Mekelle, in Northern Ethiopia (Published)
The main objective of the study was to assess the performance of Saving and Credit Cooperatives (SACCOs) in Hawelti Sub-city. Various methodologies were used to conduct this research. A random sampling technique was used to take 214 respondents from the sample population. Both questionnaire and interview instruments were used to collect reliable data. The primary data was gathered from members of a sample SACCOs via a questionnaire. The mixed quantitative and qualitative research approaches were employed. The secondary data was used and collected from the SACCOs’ audit records. Data were analyzed using SPSS version 25 and Microsoft Excel and results were analyzed using descriptive statistics to generate tables, frequency, percentages, and graphs. To analyze the financial performance of SACCOs the PEARLS model was employed. The study results exhibited that the services’ delivery on diversified products of saving, and loans were decent and through the provision of loans, members got a significant change in their living standards. SACCO’s membership was raised, but not to the standard, and the promotion was determined to be inefficient and ineffective. The governance perspective of SACCO was found that members have trust, clarity, transparency, and discuss freely in their general assembly meetings. Regarding the financial performance, the saving deposit and total assets of SACCOs achieved tremendous growth. However, the net loan portfolio was found to be below the standard and has come across serious liquidity problems. The key challenges hampering the SACCOs are lack of governance, weak financial monitoring system, lack of financial regulation and proper financial records, poor saving culture, lack of hiring professional manpower, and the absence of training and education. The possible recommendations are creating awareness among members regarding their rights, and by-laws, hiring the required professionals, training based on need and gap assessment, and developing and introducing financial regulatory and monitory systems.