FACTORS AFFECTING SAVING PRACTICES OF MEMBERS OF RURAL SAVING AND CREDIT COOPERATIVES (THE CASE OF ADA’A WOREDA, EAST SHEWA ZONE, OROMIA, ETHIOPIA).

Abstract

The purpose of this study was to determine the factors that affect the savings habits of members of rural saving and credit cooperatives (RuSACCOs) in the Ada'a Woreda Bishoftu Oromia Region's East Shewa zone. The study data was collected from 390 sample respondents. The simple random sampling method is used. The data were collected using questionnaires. A 99.5% response rate was achieved. To identify the effect of correlations between the dependent and independent variables in the study, and data was analyzed using multiple linear regression models. The dependent variable is saving practice of SACCOs members and while annual income, training participation, credit received from SACCOs, age of the respondent, dependency ratio, family size, education status, savings before joining the SACCO and contribution of family members to their livelihood are the independent variables. As a result, the following significant variable were made: when the independent variables is Significant on the saving, as based on the result age, family size, saving before joining, and dependency ratio shows that there is no statistically significant. On the other hand training, education status, credit access, and income are significant and positive effect on the level of saving. As a conclusion, based on the result the government, NGOs, and other stakeholders focused on the variables that significantly and positively effect, and work together to develop SACCOs' capacity. And the recommendation of the paper mainly focused on give individualized training to their members, appropriate credit services; such as increasing the amount of credit they provide through partnerships with other financial institutions and arranging for financing injections and also activities that can increase the level and diversification of their members' income in order to mobilize savings effectively.