IDEAS home Printed from https://ideas.repec.org/a/bla/annpce/v95y2024i4p1139-1170.html

Do sustainable savings decisions through deposits and shares by members influence the choice of financial cooperatives?

Author

Listed:
  • Juliana N. Kamau
  • David M. Mathuva
  • S. Wagura Ndiritu

Abstract

The study investigates whether the choice of a financial cooperative is influenced by sustainable savings decisions through deposits or shares. The moderating influence of digital financial services (DFS) and an individual's reason for joining a financial cooperative are also investigated. Data are gathered from a cross‐sectional sample of 334 respondents drawn from 86 savings and credit cooperative societies (Saccos) in Kenya. The final sample comprises of 46 deposit‐taking (220 respondents) and 40 non–deposit‐taking (114 respondents) Saccos. Two‐sample tests, correlation and logistic regression analyses are performed to establish the factors influencing Sacco choice. Consistent with the mutual incentives and lifecycle theories, the findings reveal that an individual's choice of a financial cooperative is influenced by individual, as well as socio‐economic and environmental factors. The study finds that the desire to mobilize sustainable deposits is a more important consideration compared to building shares when choosing a Sacco. We further find that DFS are important in choosing a Sacco owing to the increased engagement and transparency associated with them. Other factors influencing Sacco choice include marital status, income levels and household location. The results help inform the focus by Sacco managers, regulators and policy makers in terms of the growth incentives to consider.

Suggested Citation

  • Juliana N. Kamau & David M. Mathuva & S. Wagura Ndiritu, 2024. "Do sustainable savings decisions through deposits and shares by members influence the choice of financial cooperatives?," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 95(4), pages 1139-1170, December.
    • Handle: RePEc:bla:annpce:v:95:y:2024:i:4:p:1139-1170
    DOI: 10.1111/apce.12480
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/apce.12480
    Download Restriction: no
    File URL: https://libkey.io/10.1111/apce.12480?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. repec:bla:pmomgt:v:27:y:2007:i:1:p:37-44 is not listed on IDEAS
    2. repec:oup:apecpp:v:37:y:2015:i:1:p:86-106 is not listed on IDEAS
    3. Leggett, Keith J. & Strand, Robert W., 2002. "Membership growth, multiple membership groups and agency control at credit unions," Review of Financial Economics, Elsevier, vol. 11(1), pages 37-46.
    4. Gottlieb, Daniel, 2007. "Asymmetric information in late 19th century cooperative insurance societies," Explorations in Economic History, Elsevier, vol. 44(2), pages 270-292, April.
    5. Donal G. McKillop & Anne-Marie Ward & John O. S. Wilson, 2007. "The Development of Credit Unions and Their Role in Tackling Financial Exclusion," Public Money & Management, Taylor & Francis Journals, vol. 27(1), pages 37-44, February.
    6. David Ely, 2014. "Credit unions and risk," Journal of Regulatory Economics, Springer, vol. 46(1), pages 80-111, August.
    7. Nikos Kalogeras & Joost M.E. Pennings & Theo Benos & Michael Doumpos, 2013. "Which Cooperative Ownership Model Performs Better? A Financial‐Decision Aid Approach," Agribusiness, John Wiley & Sons, Ltd., vol. 29(1), pages 80-95, January.
    8. Derek Jones & Panu Kalmi, 2015. "Membership and Performance in Finnish Financial Cooperatives: A New View of Cooperatives?," Review of Social Economy, Taylor & Francis Journals, vol. 73(3), pages 283-309, September.
    9. Eeva Alho, 2015. "Farmers’ self-reported value of cooperative membership: evidence from heterogeneous business and organization structures," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 3(1), pages 1-22, December.
    10. Ellen Verhofstadt & Miet Maertens, 2015. "Can Agricultural Cooperatives Reduce Poverty? Heterogeneous Impact of Cooperative Membership on Farmers' Welfare in Rwanda," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 37(1), pages 86-106.
    11. Keith J Leggett & Robert W Strand, 2002. "Membership growth, multiple membership groups and agency control at credit unions," Review of Financial Economics, John Wiley & Sons, vol. 11(1), pages 37-46.
    12. Fabio CHADDAD, 2012. "Advancing The Theory Of The Cooperative Organization: The Cooperative As A True Hybrid," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 83(4), pages 445-461, December.
    13. Donal G. McKillop & John O.S. Wilson, 2015. "Credit Unions as Cooperative Institutions: Distinctiveness, Performance and Prospects," Social and Environmental Accountability Journal, Taylor & Francis Journals, vol. 35(2), pages 96-112, September.
    14. Kumar, Anjani & Saroj, Sunil & Joshi, P.K. & Takeshima, Hiroyuki, 2018. "Does cooperative membership improve household welfare? Evidence from a panel data analysis of smallholder dairy farmers in Bihar, India," Food Policy, Elsevier, vol. 75(C), pages 24-36.
    15. Manda, Julius & Khonje, Makaiko G. & Alene, Arega D. & Tufa, Adane H & Abdoulaye, Tahirou & Mutenje, Munyaradzi & Setimela, Peter & Manyong, Victor, 2020. "Does cooperative membership increase and accelerate agricultural technology adoption? Empirical evidence from Zambia," Technological Forecasting and Social Change, Elsevier, vol. 158(C).
    16. Alexopoulos, Yiorgos & Goglio, Silvio, 2011. "Financial Cooperatives: Problems and Challenges in the Post-Crisis Era," Journal of Rural Cooperation, Hebrew University, Center for Agricultural Economic Research, vol. 39(01), pages 1-14.
    17. Svetlana Golovina & Sebastian Hess & Jerker Nilsson & Axel Wolz, 2014. "Social capital in Russian agricultural production co-operatives," Post-Communist Economies, Taylor & Francis Journals, vol. 26(4), pages 522-536, December.
    18. M. G. Hayes, 2010. "Mutual Enmity: Deposit Insurance and Economic Democracy," Review of Social Economy, Taylor & Francis Journals, vol. 68(3), pages 365-370.
    19. McKillop, Donal G. & Quinn, Barry, 2017. "Irish credit unions: Differential regulation based on business model complexity," The British Accounting Review, Elsevier, vol. 49(2), pages 230-241.
    20. McKillop, Donal & French, Declan & Quinn, Barry & Sobiech, Anna L. & Wilson, John O.S., 2020. "Cooperative financial institutions: A review of the literature," International Review of Financial Analysis, Elsevier, vol. 71(C).
    21. Charles Ferguson & Donal G Mckillop, 2000. "Classifying Credit Union Development in Terms of Mature, Transition and Nascent Industry Types," The Service Industries Journal, Taylor & Francis Journals, vol. 20(4), pages 103-120, October.
    22. Eeva ALHO, 2019. "Farmers’ Willingness To Invest In New Cooperative Instruments: A Choice Experiment," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 90(1), pages 161-186, March.
    23. Fabio R. Chaddad & Michael L. Cook, 2004. "Understanding New Cooperative Models: An Ownership–Control Rights Typology," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 26(3), pages 348-360.
    24. Derek C. JONES & Iiro JUSSILA & Panu KALMI, 2016. "The Determinants Of Membership In Cooperative Banks: Common Bond Versus Private Gain," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 87(3), pages 411-432, December.
    25. Iiro Jussila & Sanjay Goel & Pasi Tuominen, 2012. "Governance of Co-operative Organizations: A Social Exchange Perspective," Business and Management Research, Business and Management Research, Sciedu Press, vol. 1(2), pages 14-25, June.
    26. Angelini, P. & Di Salvo, R. & Ferri, G., 1998. "Availability and cost of credit for small businesses: Customer relationships and credit cooperatives," Journal of Banking & Finance, Elsevier, vol. 22(6-8), pages 925-954, August.
    27. Fabio R. Chaddad & Michael L. Cook, 2004. "Understanding New Cooperative Models: An Ownership–Control Rights Typology," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 26(3), pages 348-360.
    28. Fischer, Elisabeth & Qaim, Matin, 2012. "Linking Smallholders to Markets: Determinants and Impacts of Farmer Collective Action in Kenya," World Development, Elsevier, vol. 40(6), pages 1255-1268.
    29. Jasper GRASHUIS & Ye SU, 2019. "A Review Of The Empirical Literature On Farmer Cooperatives: Performance, Ownership And Governance, Finance, And Member Attitude," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 90(1), pages 77-102, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jasper GRASHUIS & Ye SU, 2019. "A Review Of The Empirical Literature On Farmer Cooperatives: Performance, Ownership And Governance, Finance, And Member Attitude," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 90(1), pages 77-102, March.
    2. Saulo Cardoso Maia & Gideon Carvalho Benedicto & José Willer Prado & David Alastair Robb & Oscar Neto Almeida Bispo & Mozar José Brito, 2019. "Mapping the literature on credit unions: a bibliometric investigation grounded in Scopus and Web of Science," Scientometrics, Springer;Akadémiai Kiadó, vol. 120(3), pages 929-960, September.
    3. Jasper Grashuis & Celina Martinez‐Georges, 2026. "Adoption of nontraditional governance characteristics in US farmer cooperatives," Agribusiness, John Wiley & Sons, Ltd., vol. 42(1), pages 232-247, January.
    4. Ananya Khajuria & Shaveta Kohli, 2026. "Prioritizing sustainability in agricultural marketing cooperative research: A bibliometric analysis," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 97(2), pages 291-319, June.
    5. Jasper Grashuis, 2018. "An Exploratory Study of Cooperative Survival: Strategic Adaptation to External Developments," Sustainability, MDPI, vol. 10(3), pages 1-15, February.
    6. Yuanyuan Peng & H. Holly Wang & Yueshu Zhou, 2022. "Can cooperatives help commercial farms to access credit in China? Evidence from Jiangsu Province," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 70(4), pages 325-349, December.
    7. Sanjaya Fernando & Elena Garnevska & Thiagarajah Ramilan & Nicola Shadbolt, 2025. "Cooperatives’ level of vertical integration and farm financial performance amongst smallholder farmer‐members in Sri Lanka," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 96(1), pages 149-170, March.
    8. Samal Kaliyeva & Francisco Jose Areal & Yiorgos Gadanakis, 2020. "Attitudes of Kazakh Rural Households towards Joining and Creating Cooperatives," Agriculture, MDPI, vol. 10(11), pages 1-20, November.
    9. Theo Benos & Nikos Kalogeras & Martin Wetzels & Ko De Ruyter & Joost M. E. Pennings, 2018. "Harnessing a ‘Currency Matrix’ for Performance Measurement in Cooperatives: A Multi-Phased Study," Sustainability, MDPI, vol. 10(12), pages 1-38, December.
    10. Jos BIJMAN & Markus HANISCH, 2020. "Understanding the heterogeneity among agricultural cooperatives," CIRIEC Working Papers 2013, CIRIEC - Université de Liège.
    11. Liyan Yu & Jerker Nilsson & Feng Zhan & Song Cheng, 2023. "Social Capital in Cooperative Memberships and Farmers’ Access to Bank Credit–Evidence from Fujian, China," Agriculture, MDPI, vol. 13(2), pages 1-18, February.
    12. Wanglin Ma & Sanghyun Hong & W. Robert Reed & Jianhua Duan & Phong Luu, 2023. "Yield effects of agricultural cooperative membership in developing countries: A meta‐analysis," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 94(3), pages 761-780, September.
    13. Achilleas Kontogeorgos & Panagiota Sergaki & Anastasia Kosma & Vassiliki Semou, 2018. "Organizational Models for Agricultural Cooperatives: Empirical Evidence for their Performance," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 9(4), pages 1123-1137, December.
    14. Karin Hakelius & Jerker Nilsson, 2020. "The Logic behind the Internal Governance of Sweden’s Largest Agricultural Cooperatives," Sustainability, MDPI, vol. 12(21), pages 1-19, October.
    15. Donal McKillop & John O.S. Wilson, 2011. "Credit Unions: A Theoretical and Empirical Overview," Financial Markets, Institutions & Instruments, John Wiley & Sons, vol. 20(3), pages 79-123, August.
    16. Kuhle Prudence Mnisi & Abdul Latif Alhassan, 2021. "Financial structure and cooperative efficiency: A pecking‐order evidence from sugarcane farmers in Eswatini," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 92(2), pages 261-281, June.
    17. Sebastian Billows & Elizabeth Carter & Marc-Olivier Déplaude & Loïc Mazenc & Geneviève Nguyen & François Purseigle & Annie Royer & Allison Loconto, 2025. "Reconquer and divide: comparative standard-setting strategies among producer organizations," Agriculture and Human Values, Springer;The Agriculture, Food, & Human Values Society (AFHVS), vol. 42(3), pages 1395-1410, September.
    18. Meiyuan Wang & Bin He & Jinsong Zhang & Yanan Jin, 2021. "Analysis of the Effect of Cooperatives on Increasing Farmers’ Income from the Perspective of Industry Prosperity Based on the PSM Empirical Study in Shennongjia Region," Sustainability, MDPI, vol. 13(23), pages 1-18, November.
    19. Gezahegn, Tafesse & Van Passel, Steven & Berhanu, Tekeste & D'Haese, Marijke & Maertens, Miet, 2020. "Structural and Institutional Heterogeneity among Agricultural Cooperatives in Ethiopia: Does it Matter for Farmers’ Welfare?," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 46(2), August.
    20. Huma Neupane & Krishna P. Paudel & Mandeep Adhikari & Qinying He, 2022. "Impact of cooperative membership on production efficiency of smallholder goat farmers in Nepal," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 93(2), pages 337-356, June.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:annpce:v:95:y:2024:i:4:p:1139-1170. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=1370-4788 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.