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RELEVANCE OF COOPERATIVE SOCIETIES TO THE NIGERIAN ECONOMY– A LEGAL APPROACH
This Paper discusses the importance of Cooperative Societies to the Nigerian Economy, and it was necessary to start talking about it from the Historical Perspective, when Cooperative Societies started in Europe, especially in Britain and France in the nineteenth century. In Nigeria, the records have it that Cooperative Societies started locally with the concepts of Esusu, Isusu, Osusu, Adashi, Dashi, etc, much earlier than the nineteenth century. Today, Cooperatives have developed strongly and indeed come to stay as alternative to Banking, a way in which people of common interest come together to chart ways of helping themselves, without having to pay much to obtain benefits from the Cooperative Societies. It has inculcated financial discipline among many people in the Society who ordinarily had poor savings culture. People who are members of Cooperative Societies now resort less to banks for loans, and this is a good development in any Economy. The total number of Loan applications in Nigerian Banks today by private individuals and corporate entities is scary, and could have been much more if there were no Cooperative Societies or Cooperative Concept known to citizens. What makes Commercial Banks collapse and fall out of business is largely as a result of corruption, when loans are given out contrary to Central Bank of Nigeria’s Policies on Lending. Inadequate collaterals are sometimes collected in place of very huge sums of money, most of which Debtors default in paying back. There is no doubt that the Nigerian Economy would have been far worse off today if there were no Cooperative Societies. The Cooperative Societies are a welcome development, and the Government should continue to support their existence by giving loans to the Cooperatives, once they make any Formal Request with adequate collateral(s). This Paper in addition, discusses the various types of Cooperatives existing in most World Economies, Conditions for Registration of Cooperative Societies in Nigeria, Sources of Funds for Cooperative Societies, Problems that hinder their smooth operation, etc. In conclusion, suggestions were made on how Cooperative Societies in Nigeria can move forward.
Keywords: Cooperative Societies, Rochdale Pioneers, Rochdale Principles, Members, Nigerian Cooperative Societies Act, Credit, Thrift, E.F Strickland, Loans