Measurement and Comparison of Efficiency of Saving and Loan Cooperatives in Jakarta, Indonesia, through the Stochastic Frontier Analysis

Abstract

Savings and loan cooperatives play an important role in the Indonesian economy as they also contribute to providing capital in the local market. This study examines the efficiency of savings and loan cooperatives in terms of number of members, total capital and operating costs and their effects on profits, total assets, disbursed loans and debt repayments. Two types of savings and loan cooperatives studied are savings and loan cooperatives owned by government employees and savings and loan cooperatives owned by the general public (community owned). The efficiency of these two types of cooperatives is studied separately and comparatively using the parametric Stochastic Frontier Analysis (SFA) method. and the research involved a total of 22 cooperatives from five areas in Jakarta. The results of the study used the SFA method and found that the average efficiency of community-owned cooperatives was greater than cooperatives owned by government employees.
 
 Received: 9 May 2021 / Accepted: 5 August 2021 / Published: 5 November 2021