Practices and Challenges of Rural Saving and Credit Cooperatives in Adwa Woreda

Saving and Credit Cooperatives (SACCOs) are the main financial solution of the people who have low income level. Rural Savings and Credit Cooperative are a form of a cooperative society aimed to provide financial services to its members. It is owned by its members through payment of share capital and membership fees to the institution. Despite the services provided by these cooperatives, they are facing challenges as well. To study the practices and the challenges faced by such cooperatives a descriptive research design was employed. Seven sample RUSACCOs were taken as a sample and 115 respondents were surveyed proportionally. In addition, cooperative committees, woreda cooperative officials and agents were taken as key informants. Descriptive analysis techniques were also employed to analyze the data. Results of the study shows that there is a tremendous growth in the cooperatives and variety services are provided to members. Even though there is a sign of growth, RUSACCOs are facing many challenges in their management. The main challenges are RUSACCO are not audited in time, limited training opportunities are available to the RUSACCO members, lack of proper saving, lack of knowledge in line of income generating activities, lack of professional man power, lack f awareness on saving habits, low participation of membership in RUSACCO activities, and lack of information in line of income generating activities.