| Abstract: | The main purpose of this study was to identify the challenges of Savings and credit
cooperatives (SACCOs) in Addis Ababa. The study followed qualitative research approach
and exploratory research design. Purposive quota sampling methods were employed to
select the sample respondents. Primary and secondary sources of data were used. A review
of relevant documents, interview schedule and focus group discussion were prepared and
administered with purposely selected SACCO members, various committee members and
cooperative officials and auditors at Addis Ababa city, sub-city and federal level. The
collected data were analyzed by content analysis. Poor governance and leadership, lack of
skilled manpower, lack of office and materials, poor educational status of committees and
poor members’ participation, lack of audit service, lack of appropriate support from
cooperative promoters and NGOs, regulatory limitation and non awareness of the existing
opportunities by the members are the main findings. Based on the above findings, the
following recommendations were proposed: SACCOs should provide member driven
services, diversified financial product, hire qualified manpower in the right position,
strengthening the governance and internal control system. Cooperative promotion and
development sector at city and federal level, donors and other stakeholders should assist
SACCOs to undertake awareness creation program, training, education, and information
about SACCOs’ operations, credit, shares and investment, providing regular audit and
inspection service, technical and material assistance. In addition, the government should
revise the current cooperative promotion and development structure, restructuring and
producing appropriate regulatory environment for SACCOs. Finally, Universities should
undertake research studies on financial cooperative are the possible recommendations.
Key words: challenges, savings, credit, and cooperatives, Addis Ababa |
