ALL over the world, especially in Third World economies, one of the platforms through which peoples’ common business dreams and financial needs are crytalised is the cooperative society. A cooperative society is simply a voluntary association of individuals who have come together to pursue their economic goals. In Nigeria, cooperative societies are governed by the Nigeria Cooperative Societies Act.
According to the United Nation, there are no fewer than three million cooperatives in the world. UN said, “While the largest three hundred cooperatives across the globe report a turnover of over two billion dollars annually, cooperatives employ two hundred and eighty million people globally, translating into ten per cent of the world’s employed population.”
Meanwhile, owing to the importance of cooperative societies which are seen as the lenders of last resort for the common man in developing countries like Nigeria, the United Nation has set aside every first Saturday in July annually as world International Day of Cooperatives (IDC). According to the UN, the IDC is an annual celebration of the Cooperative movement that took place on the first Saturday of July in 1923.
The UN said, “The aim of the celebration is to increase awareness of cooperatives,” adding that, “The event underscores the contributions of the cooperative movement to resolving the major problems addressed by the United Nations and to strengthening and extending the partnerships between the International Cooperative movement and other actors.”
Themed “Cooperative for Climate Action”, this year’s celebration, according to the UN, will focus on the contribution of cooperatives to combating climate change and to support Sustainable Developments Goal (SDG) 13 on Climate Action.”
The international body said the theme became expedient in view of the way “climate change severely impacts people’s livelihoods around the world, especially the most disadvantaged groups such as small-scale farmers, women, youth, indigenous peoples and ethnic minorities, who have to cope with extreme natural disasters and degradation of natural resources.”
Unlike last year, this year’s celebration was low-keyed across the globe due to the dreadful outbreak of the coronavirus pandemic which has continued to make it increasingly difficult for these cooperatives to survive, let alone help realized the economic dreams of their members. By grounding economic activities globally, slashing government revenue and crashing the economy of several countries especially those relying on petroleum as major source of revenue, COVID-19 has driven more Nigerians into abject penury as it has greatly sliced their daily earnings.
The severity of the lockdown arising from the pandemic gave rise to several anti-social mechanism, one of which is social distancing and closure of schools and these have dealt a big blow to many cooperative societies in the country. Social distancing for example has impacted on the cooperative societies’ usual meetings.
According to Mr Ogunreku Segun, the Dean of Students Affairs, Federal Cooperative College, Eleyele, Ibadan, Oyo State, the meetings are the power hold of most cooperative societies.
“We have the departmental and the orthodox cooperative societies. In the orthodox, members have to go for meetings because it is their power hold. This is because it is when members go for meetings, that they can pay their thrift savings and share capitals as well as collect loans if they are due for it.
“This is their style and for them, meeting is very compulsory. In fact, if a person will not be going for the meeting, he or she must send someone who will pay all the dues and perform all the necessary duties for that meeting on their behalf,” he explained.
But since February that the virus broke into the country, the various orthodox cooperative societies which remain the largest have not been meeting, owing to government directives.
Speaking to Sunday Tribune, a top female official of one of the cooperative societies in Ijokodo area of Ibadan, who pleaded anonymity, said the society has recorded severe losses since their meeting places had been put under lock and keys.
“In the beginning when the lockdown was ordered, it prevented our people from working. So, there was no way they could get money to repay their loans and other association dues. Some of them don’t even have money to eat let alone invest in anything. The worst part of the whole thing is that people have not been allowed to meet even we, the executive members cannot meet because the schools where we used to meet have been locked ever since. So, this with the economic scarcity, has dealt us a big blow,” she said.
Speaking further, she said: “Secondly, before the easing of the lockdown, few of our members who wanted to pay something experienced huge difficulty at the banks. Many of them were often turned back because most of the banks were closed then. Only few of them who had access to internet banking were able to transfer little amounts to the association’s account. Many of them said they had to use the little money they had saved to take care of their family needs as there was no financial assistance or palliatives coming to them from government to cushion the effect of the lockdown.
“In those days when the virus hadn’t crashed the economy, people repaid their loans promptly. The fees were paid into the banks and members came to us with the tellers for necessary documentation. Aside giving people loans, then, we used to invest in fixed deposits in the bank and get good interests on our money. We also invest in Treasury bills of the Federal government.
“Also, during the good old days, we used to deal in home-use equipment and gadgets. We bought them in bulk and distribute to our members and they paid back with five percent interests. Even during festivities like Christmas, Easter, Ileya and others, we used to give out sums ranging from N20,000 and above to our members and also get five percent interests. And at the end of the year during our Annual General Meeting (AGM), we aggregate all the interests on all our investments and they become our AGM dividends. But the pandemic has made all these impossible now,” she further explained.
Speaking further, Ogunreku, who is also the secretary of a cooperative society, said there is another type of cooperative society in Nigeria called the departmental cooperative societies. He said unlike the orthodox, the departmental cooperative society is an association whose members are majorly civil servants and that the beauty of it is that every thrift savings and share capital payment is deducted from source into the association’s account. He stressed that, unlike the orthodox, there is no need for regular meetings except there is an emergency.
“The departmental societies are still one of the forces keeping cooperative businesses alive in Nigeria because if not for them, majority of the orthodox societies would have been dead due to nonchalant attitudes and dishonesty often exhibited by members,” he said.
Explaining the challenges confronting the societies in view of the economic woes caused by the deadly coronavirus, Ogunreku said, “The departmental cooperatives don’t have problems because of the standing order which posits that every loan repayment should be deducted from source. But for the orthodox which only gets repayment when people gather for meetings, this COVID-19 has greatly threatened their survival because it has confined people to their homes.
“The case is critical because people that are due for loans and had been hoping to collect it for one business or the other cannot be given. People have not been paying up because there is cash crunch. Even those that have little to pay, the fear of what might happen to their families when they drop the money often grips them.
So, nobody is paying up and none is collecting. If these trends continue longer than expected, it will eventually kill some (cooperative) societies.”
He called for grants from the government to assist the cooperative societies in a bid to ensure their survival.
The bookkeeper of Odo Ona, Ibadan branch of the Nigerian Union of Teachers (N.U.T) Cooperative Societies (CIS), Mrs Christiana Adediji, told Sunday Tribune that “people still access loan, since most teachers are still being paid salaries; normal contributions are still being done, deductions of loans and normal contributions are also still being deducted from teachers’ salaries.
“Meetings have been placed on hold due to the pandemic, but if there is a need for us to go to the office, we follow the laid-down rules given by the NCDC; the use of face masks, washing of hands and the use of hand sanitizers.”
The leader of LAPO cooperative society, Alade Owo (Ibadan) Zone, Mrs Bose Olaiya, said, “money is still going out and people are still making their daily contributions, although we cannot hold meetings like we used to, but people ensure that they drop their cards along with their contributions. Also some pay back their money either on weekly basis or monthly basis, and people can still access money for loans.”
Mr Oyebamiji, former President of the Apata Ibadan of N.U.T CICS Limited said, “Basically our source of income is through salaries, and during this period of lockdown, salaries are still being paid, though we have some challenges because some people remit their dues and at the same time request for money and they are being granted. The lockdown had not affected the operation of the society but one way or the other we have some challenges especially in loan repayment through the financial institutions.
“In our society, we don’t collect cash from members; transactions are done through e-payments and people pay and collect their loans through the banks.”
—Additional reports by ADEOLA OTEMADE.
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