The role of RUSACCOs on the improvement of member’s savings behavior in Ganta Afeshum Woreda, Tigray, Ethiopia

Abstract

The study investigates the role of RUSACCOS on the improvement of members’ saving behavior in the study area. Saving is a key component in any development and it is believed to be the surest way of increasing income and enables members to reduce poverty. The study had the three Specific objectives, To analyze the existing RUSACCOS performance, to assess factors influencing role of RUSACCOs on members’ savings behavior improvement, to suggest recommendations to improve member’s savings behavior and effectiveness of RUSACCOs. To achieve the objectives, the study was undertaken in the Tigray National Regional State in the Eastern part of the region in one purposively selected woreda, namely Ganta Afeshum Woreda and used sample of 124 members, 6 promotion officials and cooperative experts and 6 from stakeholders, board and committee members were randomly selected. Both primary and secondary data were collected and used. Based on the objectives of the study, appropriate tools and techniques of analysis such as descriptive statistics, frequency, mean, minimum, maximum and percentage were employed. The variables that influence improvement of members’ saving behavior are seventeen: Annual savings, credit beneficiaries, savings interest, safety/security, convenience, liquidity, positive returns, amount of loan borrowed, access to training, distance to RUSACCOS office; accountability, transparency, education level, employment, seniority, annual income and family size. Based on the findings the study concluded that majority of members have poor saving habit, lack of training, less awareness about RUSACCOs are appropriate options for the rural households, which are providing services to improve members’ saving in sustainable manner. Major recommendations were made, RUSACCOs should develop varied products that meet various membership needs, Reward for regular savers by payment of interest on savings deposits, government and non Government organizations should create on saving mobilization, provide skill and knowledge though problem based trainings to improve members’ saving behavior and effectiveness of RUSACCOS.