ENHANCING THE PROCESS COOPERATIVE SOCIETY WITHIN UNIVERSITY OF ILORIN

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CHAPTER ONE

  1. BACKGROUND OF THE STUDY

Cooperative society may be described as a group of people with the common objective of creation of funds to be lent to its members, all the member must be residing in same, village or group of village (Onuoha, 1986). Cooperative society may also be described as the coming together (freely) of a group of people called cooperators for the purpose of improving their financial position or standing by putting their resources together which would have been difficult or almost impossible to achieve individually. The procedure can be inform of sharing, saving and deposit out of which will be lent to any member in need with reasonable interest (Epetimehin, 2006).

Cooperative Thrift and Credit Societies are member-based organizations that help members to address economic problems. They are not banking institutions because of their goal. The ultimate goal is to encourage thrift among the members and to meet credit needs of people who might otherwise fall prey to loan sharks and other predatory lenders (The Ledger, 2004). Cooperative societies are widely spread organization in developing countries, they are known for a strong commitment of, as well as participation in the decision making of their members (Haan et al., 2003).

The International Cooperative Alliance (ICA) in its Statement on the Cooperate Identity, in 1995, defines a cooperative as “an autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise.” It is a business voluntarily owned and controlled by its member patrons and operated for them and by them on a nonprofit or cost basis (UWCC, 2002). It is a business enterprise that aims at complete identity of the component factors of ownership, control and use of service, three distinct features that differentiate cooperatives from other businesses (Laidlaw, 1974).

These societies mobilize local savings and administer credit to members, there by encouraging thrift and entrepreneurial activity. When first started, credit unions use relatively unsophisticated administrative practices, so that the costs are very small and most interest income from loans may either be distributed to the members or reinvested in the credit union within a capitalization programme. Consequently, they can be set up in poor communities, where access to means of secure savings and to credit at non-exploitative terms is of greatest importance (Olorunlomerue, 2011).

Cooperatives are community-based, rooted in democracy, flexible, and have participatory involvement, which makes them well suited for economic development (Gertler, 2001). The process of developing and sustaining a cooperative involves the processes of developing and promoting community spirit, identity and social organization as cooperatives play an increasingly important role worldwide in poverty reduction, facilitating job creation, economic growth and social development (Gibson, 2005).

Over some years, substantial work has been put into the use of computer in cooperative society for carrying out daily activities such as membership registration, loan monitoring and deduction and all other operation and transaction within and outside the society. Recently, there has been an upsurge in the information about capital base investments profit-sharing or dividends of co-operative society in Nigeria have since become as strong instrument of achieving rural, communal and national development (Osusuet al, 2006). There is an urgent need for the development of a centralized system for cooperative society so has to help in keeping large volume of data, performing necessary operation and reducing the number of hours spent on compilation and some other activities. This system intends to develop a centralized system where each cooperative society can log on with a unique password to register her society and also to give details of their financial statement such as (membership saving, loan issued, loan repaid, loan out-sand, net surplus or dividend, interest rate, number of register member etc.) at end of each fiscal year. These societies mobilize local savings and administer credit to members, thereby encouraging thrift and entrepreneurial activity. When first started, credit unions use relatively unsophisticated administrative practices, so that the costs are very small and most interest income from loans may either be distributed to the members or reinvested in the credit union within a capitalization programme. Consequently, they can be set up in poor communities, where access to means of secure savings and to credit at non-exploitative terms is of greatest importance (UNDESA, 1999).

ENHANCING THE PROCESS COOPERATIVE SOCIETY WITHIN UNIVERSITY OF ILORIN