Savings and credit cooperatives towards economic security. A study of Umurenge Sacco Wisigara Muhanga

Abstract

The research on Savings and Credit Cooperatives Towards Economic Security: A Study of Umurenge SACCO Wisigara Muhanga was carried out, having a purpose to identifying the challenges that poor people in fist category of Rwandans Ubudehe program are facing in working with Umurenge SACCOs in the aim of having capabilities to cover their essential needs sustainably using its services as per GoR policy. The collection of data was done using the literature review, questionnaire, focus group discussion and interviews. Also, within the targeted population group of 108 individuals’ members of poor families who are clients of Umurenge SACCO Wisigara, a sample size of 50 respondents has been taken using simple random sampling technique of probability sampling methods. The researcher also conducted the interviews with LODA staff in Muhanga district ES and Umurenge SACCO Wisigara Manager in Muhanga sector. A research revealed that a big number of poor people don’t save and credit with Umurenge SACCO due to low financial literacy, sensitization and information by Umurenge SACCO manager and local leaders, lack of credibility or lack of trust for not being able to reimburse a credit from the bank, high interest rate (24%) and mortgage. All of these issues constitute a great barrier for the poor who need to access to financial services offered by Umurenge SACCOs. Low income earners need financial capabilities to ensure that economic security issues are well addressed. If they are not economically secured, poverty cannot decrease and it causes a serious concern especially lack of income generating activity and foods which may lead to insecurity, conflict and criminal activities as well as civil disturbance. Therefore, this research concluded with the recommendations for the poor can help to remove the challenges to enhance the access to Umurenge SACCO services aim at supporting them with financial security to improve lifestyle and live peaceful life.