Ifeanyi Nwoko was introduced to the News Agency of Nigeria (NAN) Multipurpose Cooperative when he assumed work at the News Agency of Nigeria, he was skeptical to join. Poor stories had emerged about the association which had gone moribund for a while following a couple hitches in the first few years of its existence. That was until the need to raise fund for an urgent need opened his eyes to the benefits of belonging to a cooperative.
Today, the twenty year old cooperative has blossomed into one that helps NAN staff with their needs, save money, grow their businesses, approach government for special favours for members of staff.
What is a cooperative or cooperative society?
Cooperative societies are voluntary associations of people who work together to promote their socio-and-or-economic interests. It is based on the principle of self-help and mutual help. The purpose of a cooperative is to realise the economic, cultural and social needs of the organisation’s members and its surrounding community. Cooperatives often exhibit strong commitment to their community and aim at strengthening the community where they exist or serve.
There are five types of cooperatives. These include Worker Cooperative, owned and democratically governed by employees who become co-operative members. Credit Cooperative Societies, voluntary and mutual aid associations that provide credit on personal security or on the basis of nominal security to its members, who are either cultivators, workmen or lower middle class people. Consumer Cooperatives, largely consisting of agricultural workers and middle class people who organise a consumer store. Members earn their independent income and do not depend on the store for daily income. Producers Cooperative, often organised for the production of goods and services based upon common ownership and management by a group of workers to eliminate the employee-employer relationship. The producers of commodities or crafts join forces to process and market their products. Finally, Housing Cooperatives, that provides affordable housing to the middle and low-income groups by members owning a share in the entire corporation rather than a real estate ownership.
What are the inherent benefits of a cooperative society?
Members of a cooperative can borrow funds from the cooperative at a flat rate of 10 per cent which is much better than going to the bank.
Some other time they were sharing their dividends at the end of the financial year, some members make some cool cash. If a cooperative is stable rather than leave my money in the bank to yield nothing at the end of the year, I might as well leave them with a cooperative, buy shares, save and get payback at the end of the year.
Also, if one needs money urgently, the protocol is that of a 15 per cent flat rate.
In the past cooperatives approach household appliance sellers that members need but can’t easily afford. They negotiate fair prices for bulk buy. So, when members of the staff buy goods from these sellers, the cooperative pays for the goods upfront while members of staff pay the cooperative in bits/by installments.
There are similar arrangement for land, which the older members of the cooperative benefitted from, and for which they are working for new members yet to benefit. Rather than borrowing from the bank to at high interest rates to offset school fees, cooperative enables members pay 10 per cent flat interest to take the loan they want and pay back. There are also dividends for the shares you buy.
How can Nigerians position themselves to benefit from these cooperatives?
Join a cooperative, or start one with a group of individuals like yourself with common interests, if you are unable find a cooperative that meets your needs. Find out how much it costs to register a cooperative in your country, make payment. After the payment, you get a letter of recognition as a license for three years, before you get a certificate of registration as a legal entity. You need your cooperative, be it one you joined or kick started yourself to be effective. So, you need to have the right manpower and tools to help you.
Cooperatives improve one’s creditworthiness as a producer as well as a consumer.
They prioritize welfare of groups of people with a same interest and can benefit the needs of its host society.
Receive substantial amount of government support.
Ensures dividends from investments rather than letting one’s money lie fallow at the bank.