Credit Associations Research Articles

Effect of digital financial services on financial performance of rotating, savings and credit associations in Mombasa County

Effect of digital financial services on financial performance of rotating, savings and credit associations in Mombasa County

Tinjauan Konsumerisme dalam Trend Arisan Online

Online arisan is a phenomenon where people organize and participate in arisan (rotating savings and credit associations) through online platforms. In online arisan, consumerism can have diverse impacts depending on the values and behaviors adopted by the participants. Factors that can influence consumerism in online arisan include the choice of prizes, the use of technology and social media, as well as the convenience and flexibility offered by online arisan. Although there is potential for more dominant consumerism, there are still arisan groups that maintain their traditional values.

Factors That Affect Rural Financial Inclusion: A Case of Gambella Town, Gambell Peoples National Regional State, Ethiopia

The significance of an inclusive financial system is widely acknowledged in the policy community, and it is now a top priority in many nations, including Ethiopia. This study aimed to analyze the elements that affect financial inclusion in rural areas and how to increase it among customers and residents of Gambella People’s National Regional State in Ethiopia. The population was condensed to include only the staff of the Gambella Saving and Credit Institution in Gambella town. The study employed primary data, and STATA 13 and the Statistical Package of Social Science (SPSS) 23 were used to analyze the data. Data were collected in the form of descriptive and inferential statistics. The study discovered that characteristics that affect financial inclusion had statistically significant and positive relationships with sex, marital status, religion, degree of education, service quality, income, and trust in financial services. However, the proximity to a financial institution’s branch and a resident’s ID card had a detrimental impact on the characteristics that influence financial inclusion. The report also suggests managers and decision-makers at the Oromia Credit and Saving Association should take great care in how they carry out their duties and consistently seek to inspire and raise awareness among the people by emphasizing the value and benefits of being financially integrated. Keywords: credit and saving institution, factors, financial inclusion, gambella, logit model

Stakeholder mapping to explore social and economic capital of Rotating Savings and Credit Associations (ROSCAs) to increase demand for and access to healthy food

IntroductionSouth Africa, grappling with the complexities of malnutrition, faces a dual challenge of undernutrition in children and overnutrition in adults, particularly among women. This situation is exacerbated by high rates of food insecurity, affecting nearly one-fourth of households. In this context, the role of Rotating Savings and Credit Associations (ROSCAs), locally known as stokvels, becomes increasingly significant. These informal, often women-led, savings and borrowing groups present a unique opportunity to address dietary challenges and promote healthier eating practices in urban, low-income settings. This study explores the potential of stokvels in mitigating the dual burden of malnutrition by facilitating access to healthy, affordable foods.MethodsWe conducted stakeholder mapping to understand the roles and influences of various actors within South Africa's food system, particularly their interactions with stokvels. Our research focuses on how these groups, deeply embedded in the community fabric, can leverage their collective power to negotiate better access to nutritious food and influence healthier dietary choices. Stakeholders identified in the study span diverse sectors, including retail, agriculture, finance, and community organizations.ResultsThe research reveals that stokvels are perceived as vital social and economic entities capable of maximizing value through partnerships and networks. However, challenges such as the informal nature of stokvels and the lack of formal legal agreements often hinder their ability to form partnerships with formal institutions. The findings emphasize the importance of understanding and leveraging the social dynamics within stokvels, recognizing their role in enhancing food security and contributing to economic empowerment, especially for women. The study also identifies the need for formalizing stokvel structures to enhance their operational efficiency and increase their impact on food systems.DiscussionIn conclusion, this research highlights the untapped potential of stokvels in addressing South Africa's nutritional challenges. By fostering stronger connections between stokvels and various food system actors, there is a significant opportunity to improve food security and promote healthier eating habits in low-income communities. Future research should aim to include unrepresented stakeholders and explore strategies to enhance the role of ROSCAs in promoting healthier food choices and addressing affordability and accessibility barriers.

Alternative currencies, community support and social cohesion: why the Okinawan moai (模合) is closer to an informal social policy mechanism than to a standard ROSCA

To challenge the notion of the Okinawan moai as a Rotating Saving and Credit Association, this article provides a short overview of the practice before reflecting on an interesting pattern. While moai has been phased out in most of Japan, it persists in some areas where, incidentally, life expectancy is higher than the rest of the country (and of much of the rest of the world). Expanding upon the idea that moai’s main function is social rather than economic makes it possible to suggest the existence of alternative currencies that, although less tangible than money, have a major role in the people’s lives, create mutual dependency and ultimately enhance people’s wealth, intended here to refer not to economic wealth but also in a more inclusive or socially mediated manner including social relations, happiness, a sense of protection and so on.

Community groups as an enabler for access to livelihood capitals, deprivation of which contributes to multidimensional poverty in rural Uganda

Using the 2016/2017 and 2019/2020 Uganda National Household Survey (UNHS), this study analyses the effect of saving and credit community groups, both cooperatives and associations, on multidimensional poverty. Access to livelihood capitals reduces poverty. Poverty being a rural phenomenon in Uganda, this study assesses whether households in rural Uganda with community group members have access to livelihood capitals. The study also examined the effect of non-membership in a community group on multidimensional poverty and whether being multidimensionally poor affects membership in community groups. The Alkire-Foster method is applied to calculate the Adjusted Headcount Ratio (M0), which is used in the propensity score model to establish the effect of membership in a community group on household multidimensional poverty. Analysis of how the estimated multidimensional poverty varies with the estimated propensity score is achieved using the estimated Average Treatment Effect of the Treated (ATET) obtained with four matching methods (nearest neighbour, radius, kernel, and stratification). Findings reveal that community groups enable rural dwellers to access livelihood capitals, hence enabling them to overcome their multiple deprivations and reducing their likelihood of being multidimensionally poor. Membership in community groups is robustly linked to a decreased probability of being multidimensionally poor by over 3 percentage points.

How informal financial service institutes facilitate the financial inclusion of low-income, unbanked consumers

PurposeThe present study aimed to provide an understanding of the roles of community-based financial service organizations (i.e. rotating savings and credit associations [ROSCAs] as institutional pillars in facilitating low-income, unbanked consumers’ access to informal financial services).Design/methodology/approachSemi-structured interviews were conducted with 39 low-income, unbanked consumers participating in ROSCAs in Pakistan, where only 21% of adults have a bank account and almost four out of five individuals live on a low income. The obtained data were analyzed using the thematic analysis technique.FindingsROSCAs’ regulatory, sociocultural and cognitive aspects facilitate low-income, unbanked consumers’ utilization of informal financial services owing to their approachability by, suitability for, and fairness to such consumers. Thus, they promote such consumers’ financial inclusion.Practical implicationsLow-income consumers are mostly unable to access formal financial services due to the existing supply- and demand-side impediments. Understanding ROSCAs’ institutional functioning can help formal financial service providers create more transformative financial services based on the positive institutional aspects of ROSCAs to enhance poor consumers’ financial inclusion and well-being.Social implicationsThe inclusion of low-income, unbanked consumers in formal banking services will help them better control their finances.Originality/valueMany low-income, unbanked consumers in developing countries utilize informal financial services to meet their basic financial needs, but service researchers have rarely investigated how informal financial institutions function. The present study showed that ROSCAs, as informal institutions, meet low-income, unbanked consumers’ personal, social and financial needs in a befitting manner, which encourages such consumers to use the financial services offered by ROSCAs.

Co-operative Banks - A Helping Hands for Small and Medium Entrepreneurs in Saharanpur District

Co-operative banks are more structured compared to credit associations. While local branches of cooperative banks can pick their own leaders and manage their own tasks, big decisions need to be approved by a main office. Credit associations frequently exercise significant local fundamental leadership, but by joining forces, they can share back-office functions including access to the global payments system. This essay provides background information on cooperative banks and small bank groups. Co-operative banks have more information available than "little establishments" as a whole cooperative banking systems exhibit greater organizational structure compared to credit association systems. Local branches of cooperative banks have autonomy in selecting their executive candidates and managing their operations. Small and medium enterprises (SMEs) encounter unique challenges in their development compared to large enterprises. The competitive market environment demands that SMEs adapt to the survival-of-the-fittest dynamics inherent in a market economy. In essence, this translates to a competition for human resources, making staff training a crucial method for SMEs aiming at long-term, stable development. Staff training serves as a fundamental approach to elevate the quality of human resources within SMEs. The paper provides background information on cooperative banks and small bank groups, highlighting their organizational structure and decision-making processes. It emphasizes the importance of staff training in small and medium enterprises (SMEs) for long-term, stable development, as it enhances the quality of human resources and improves overall productivity and competitiveness. The paper discusses the role of corporate culture in SMEs, stating that cultivating a positive corporate culture can enhance cohesion, employee loyalty, motivation, and job satisfaction, ultimately fostering productivity and innovative outcomes. It also highlights that a strong corporate culture can be a unique selling proposition for SMEs in attracting and retaining top talent. Additionally, the paper mentions the significance of cooperative banks in rural financing and their growing activity in metropolitan areas, contributing to the local economy and employment generation.

Exploring Factors Influencing Family's Enrollment in Community-Based Health Insurance in the City of Gondar Peri-Urban Community, Northwest Ethiopia: A Health Belief Model Approach.

A research gap exists in finding practical solutions to provide affordable and accessible health insurance coverage to improve CBHI enrollment and sustainability to people in resource-poor settings and contribute to achieving universal health coverage (UHC) in Ethiopia. This research was initiated to analyze the role of community trust in scheme management and health choice to identify significant factors based on the health belief model (HBM). This psychological framework explains and predicts health behavior by considering individual perceptions. Cross-sectional information was gathered from 358 families, and original facts were utilized. Descriptive data and the Binary logistics in the econometric model were applied for data analysis. The descriptive findings demonstrated that other variables were established to possess a significant consequence except for job and occupation variables. The results of the logistic regression model showed that the distance of the nearest health station from the family's home in a minute [AOR (95% CI) =0.177 (0.015, -0.399)], being a member of the families having an official position in local government or cultural structure [AOR (95% CI) =0.574 (0.355, 0.793)], having an experience of visiting health facilities [AOR (95% CI) =0.281 (0.166, 0.396)], and perceiving the local CBHI scheme management as trustworthy [AOR (95% CI) =0.404 (0.233, 0.575)] were positively associated with family enrollment in the CBHI scheme. On the other hand, being a member of the "rotating saving and credit association" (ROSCA) [AOR (95% CI) =-.299 (-.478, -0.120)] was negatively associated with the family's enrollment in the CBHI scheme. Trust in CBHI scheme management, family's experience of visiting health facilities, and distance from the nearest health station were essential factors influencing enrollment in CBHI schemes. "Rotating saving and credit association" (ROSCA) ° negatively and statistically significantly impacted the family's CBHI enrolment status. Income level was not associated with enrollment.

Infrabanking: Mobilizing capital in communist Cuba

AbstractIn 2011, the Cuban government authorized banks to start offering loan credit to the country's growing number of small businesses for the first time since the beginning of the revolution. Yet in the following years, citizens have largely circumvented these services. This article draws on twenty months of fieldwork among market traders in Havana to examine why so few Cubans rely on the formal banking system to secure capital. It analyzes alternative methods people employ to organize their financial futures, by leveraging kinship ties, partnerships, friendships, property, and loan sharks, and by participating in rotating savings and credit associations. To understand the advantages these approaches offer to mobilize capital, it is crucial to grasp how people navigate their economic lives in ways that are influenced but not dictated by short‐term considerations of net profit. Nonmonetary concerns about access, time frame, and visibility lead people to raise and store wealth outside the formal banking system, constituting a domain I call infrabanking: banking practices that are too far removed from the established assumptions about banking to be perceived as part of the same phenomenon.

Micro, small and medium enterprises and their linkage with key actors in Ethiopia: developing entrepreneurial ecosystem mapping

Since micro, small, and medium enterprises (MSMEs) are a basic source of income and employment opportunities for the least developed countries, more emphasis has recently been given to those enterprises, and a number of research studies have been conducted. Ethiopia, as one of the Least Developed countries, could also benefit from those MSMEs if the sector is supported enough. Accordingly, this research is conducted to identify the basic determinants of the performance of MSMEs in Ethiopia and to try to develop an entrepreneurial ecosystem mapping to connect those enterprises with the concerned stakeholders, which can contribute to the improvement of the performance of MSMEs. Primary data from randomly selected 400 sampled enterprises is analyzed using ordered logistic regression, and data collected from stakeholder interviews is analyzed using descriptive analysis to develop the ecosystem mapping. Accordingly, academic institutions, such as universities, financial institutions, such as banks and credit associations, non-governmental organizations, such as GIZ and Reach for Change, and government organizations are important actors in entrepreneurship in Ethiopia. Finally, the result of the ordered logit model indicates that access to finance, training, and raw materials, experience, level of education, and sectoral dummy are statistically significant factors that affect the performance of MSMEs. Based on the results, we recommend the government of Ethiopia give more emphasis to MSMEs in different forms, such as providing support in the form of financial, training, market, and raw material linkages.

Rotating savings and credit associations (ROSCAs) in prewar China: Communal finance and the roots of economic development

AbstractThis article studies Rotating Savings and Credit Associations (ROSCAs) in late imperial and Republican‐era Shanxi province, China, from the eighteenth to the twentieth centuries. It investigates how communal finance fostered pre‐industrial economic growth and commercial activity. Drawing on previously unused, original materials from historical Shanxi ROSCAs and households, it makes several important discoveries. First, it finds widespread ROSCA participation, estimating no fewer than 7.1 per cent of Shanxi households participated in ROSCAs. Second, it estimates expected internal rates of returns on ROSCA membership at 2.55–6.01 per cent annually. This suggests that ROSCAs were economically competitive with other Chinese traditional financiers, which often charged more for loans and offered less to savers. Third, it finds a surprising degree of liquidity for ROSCA shares. Finally, it uncovers commercial entities participating in ROSCAs, suggesting ROSCAs could be useful to for‐profit enterprises. The article concludes that ROSCAs and communal finance may have played an important role in supporting pre‐industrial economic activity.

A Study on Customer Satisfaction and Perception of Online Banking Services in Salem District

In our bustling lives, we are in a test of skill and endurance consistently. Everybody really must attempt to carve out ways of saving opportunity. One of the innovative headways that empowers clients to go through with their monetary exchanges from a retail or mechanized bank, credit association, or other monetary foundation on a protected stage is web based banking. Internet banking, likewise alluded to as electronic banking, is the advanced appropriation of crisp banking services and products to clients straightforwardly through electronic, intuitive contact organizations. It gives clients many advantages and qualities over customary banking. Internet banking is a speedy and simple method for getting cell phone admittance to your bank whenever. Web based financial purposes the web for of circulating monetary exchanges. With regards to getting everyday things done, bank moves are a relic of past times thanks to internet banking services. One of the most popular services presented by banks is internet banking, which makes it a truly dependable stage. Banks regularly utilize encryption frameworks to ensure the security of all client information and the shortfall of information breaks. Eventually, it shields against online extortion and record control. The pace of web access, the new web based financial elements, and the recurrence of internet banking utilize all influence how rapidly internet banking creates in every country. At the point when the tasks of banks and monetary organizations are joined with data innovation, web based banking is made in the banking sector. Hence, the present paper has been aimed to give an analytical view on customer satisfaction and preference on online banking services in Salem district.

The village bank of a Lisu community: Indigenous belief, economic practices, and environmental conservation in Southwest China

Using the rotating credit association created by a Lisu village, called the “village bank,” this study explores the social forces that have shaped, limited, or activated the ethnic community’s local environmental agency in southwest China. We argue that while the inherited elements of the Lisu indigenous beliefs could help local communities meet the ecological needs of our time, offering different ethics and perspectives to challenge the pursuit of material abundance based on extractive economic modes, the Lisu’s social and economic behavior is not solely determined by their religious beliefs. In the post-Mao economic reform era, village banks have become a fresh way through which Lisu villages activated their environmental agency, trying to achieve a balance between environmental protection and poverty reduction. Lisu’s “ambivalent” stance on environmental protection reflects the interactions between state-orchestrated development, NGOs, and the tension between maintaining tradition and reducing poverty.

Financial Attitude, Trust, and ROSCAs' Member Commitment: Social Relations as Mediating Factor

Purpose: This research examines the function of social relationships in the association between financial attitudes and trusts toward member commitment of informal financial institutions, notably the rotating savings and credit association in Indonesia.
 Design/methodology/approach: The study consisted of 207 female participants, and a partial least square structural equation modelling was utilized to test the hypotheses. All items' validity and reliability were confirmed through inner and outer model testing.
 Findings: The study found that financial attitudes and trust did not significantly affect commitment but positively influenced social relations. Additionally, social relations impacted commitment and mediated the relationship between financial attitudes, trust, and commitment.
 Research limitations/implications: Therefore, the study underscores the need to prioritize women and social relationships in informal financial institutions to enhance informal financial inclusion from the grassroots level.
 Originality/value: These findings highlight the critical role of social cohesion in financial activities and emphasize the potential of informal financial institutions to alleviate short-term liquidity pressures.

Rotating savings and credit associations: A scoping review

A Rotating Savings and Credit Association (ROSCA) is an informal cooperation strategy that has emerged in several parts of the world as a tool to increase the resilience and social development of individuals in underprivileged communities. This strategy has been widely studied for decades to recognize ROSCAs’ benefits, risks, and operation rules in several regions and countries. In this study, we conducted a scoping review using the PRISMA-ScR protocol to determine the most important recent findings about ROSCAs. First, we analyzed the location of the community being studied, methodological approaches, and most common keywords of the 96 articles included in the review. Second, we discussed the most significant conclusions of each article on topics such as the origin, participants, benefits, risks, operation, penalties, and structure of ROSCAs. Based on this review, we discuss how ROSCAs have provided benefits to their members that are not exclusively financial, how these schemes have evolved from traditional ones to strategies with improved structure, rules, and technological tools, and some key research opportunities to be addressed.

Risk management in prewar China: A study of rotating savings and credit associations (ROSCAs) in Qing dynasty and Republican-era Shanxi province

This article studies Rotating Savings and Credit Associations (ROSCAs) in Qing-dynasty (1644-1911) and Republican-era (1911-1949) Shanxi province. These were communally based financial institutions crucial to the traditional Chinese economy. Drawing on previously unused primary sources this article examines historical Chinese ROSCAs from the perspective of risk management. It finds that Chinese ROSCA credit was collateralised by fixed assets. In the event of member default, the ROSCA exercised ‘live sale’ rights over the delinquent member’s ­collateral. These findings have important implications for one of Qing and Republican China’s most critical financial institutions and for Chinese economic history more broadly. They suggest greater liquidity of fixed assets and ability to mobilise capital than has previously been appreciated.

Household welfare effects of ROSCAs

We examine the effects of Rotating Savings and Credit Associations (ROSCAs) on household welfare in India. The identification strategy is based on household fixed effects and instrumental variables (using the geographic leave-one-out instrument). We find that ROSCA membership increases household assets, consumption, energy efficiency and school expenditure, but only in rural areas. Welfare effects are stronger for poorer households and for those living in communities with stronger social ties. We argue that the persistence and success of ROSCAs depends on social ties, which are often stronger in rural communities.

Agricultural credit association efficiencies over time and with mergers

AbstractEfficiencies of Agricultural Credit Associations of the US Farm Credit System are measured quarterly from 2005 through 2020. A slacks-based measure based on the directional distance function is used with non-performing loans included as an undesirable output. This permitted efficiency scores to be measured by type of defined input or output. Generally, most Associations were highly efficient, but there was deterioration in mean efficiency over the years 2008–2018, a period of financial difficulties in the US agriculture. Efficiencies of Associations that merged or consolidated were tracked before and after these activities. Mergers and consolidations often led to increased efficiencies.

Community Economies in the Global South: Case Studies of Rotating Savings and Credit Associations and Economic Cooperation

Community Economies in the Global South: Case Studies of Rotating Savings and Credit Associations and Economic Cooperation