Determinants of failure of savings and credit co-operative societies: A case of Jinja District

Abstract

The study was on determinants of failure of Savings and Credit Co-operative Societies in Uganda using Jinja District as a case study. Three Societies namely: Mpala, Kakira and Jinja Municipal were sampled. This empirical study (n=135) was conducted in March 2010. The determinants of failure were measured using the questionnaire whose reliability as estimated by cronbach alpha was 93%. Based on an extensive in-depth interview and closed ended questionnaire with the ordinary and the executive committee members, the findings show a significant interaction between Management, Financial and Human resource Constraints (β=0.427, 0.351& 0.216 sig= 0.000, 0.000, 0.000<0.005.) respectively and SCCS failure, while the relationship between members‟ participation and SCCS failure was not significant (β=-097, sig= 0.225>0.005) despite a higher R2 value of 78.8%. The presence of organisational culture as a moderator variable has a strong effect in accounting for variability in SCC failure in Jinja. The study concludes that whilst membership participation, financial and human resources constraints affects SCCS performance, there were management aspects of the crisis which aggravated the situation and the SCCS problems. The study recommends that for effective and successful performance of the SCCS, strategic planning, capacity building of staff and performance evaluation should be practiced and considered very imperative for sustainable operations.