Kenyans who are members of a cooperative society earn higher incomes than the national average and lead improved economic well-being compared to non-members.
According to a study by the Overseas Cooperative Development Council (OCDC), 97 per cent of Kenyan cooperators interviewed said membership has significantly improved their financial situation.
Of those sampled, 63 per cent cited access to loans, savings, shares and commissions as critical to income diversification and support during financial hardship.
About 91 per cent cited improved access to markets as a key benefit of cooperative membership, effectively attaching immense economic and social importance to being a member.
Titled, From the Ground Up: Partnering with Cooperatives on locally-led Development, the report dissects on the role cooperatives play in enhancing development at a local level.
It states that Cooperatives empower local people and institutions to own the planning, implementation, and evaluation of their own sustainable development.
“When localization is the goal, cooperatives should be a top choice as a development partner as the virtues of cooperatives as drivers of locally led development are well demonstrated,” it states, adding that cooperatives are a successful private sector business model, with a proven track record.
The social and economic importance of being a member of a cooperative society is further buttressed by an earlier report by the same institution.
In the earlier report released in 2021, titled What Difference Do Cooperatives Make, it stated that members rely less on family, friends and relatives during emergencies.
It states that cooperative members rely 23 per cent on their family, friends and relatives during emergencies compared to 41 per cent for non-members.
Consequently, non-cooperative members turn to friends, relatives and family during emergencies for financial support hence pushing them deeper into financial independence.
Kenya has become among the global focal point on issues that touch on cooperatives due to the vibrancy of the sector, where the country is ranked 7th globally and 1st in Africa.
With over 14 million Kenyans as members of a cooperative society, the country is increasingly designing policies aimed at enhancing the role of the sector in achieving meaningful and sustainable economic and social growth.
A number of Kenya’s cooperative societies have a background in agriculture, namely tea, coffee, dairy, rice and cotton.
As a result, cooperative societies under their umbrella body, the Cooperative Alliance of Kenya, have presented a memorandum before the Cooperatives and MSME Cabinet Secretary Simon Chelugui for intervention.
The players want the government to reduce the cost of agricultural production through subsidies to enable members’ contributions to improve and in a sustainable manner.
According to the study, cooperatives are locally-owned private sector businesses that arise from locally-identified needs and thus create jobs that are culturally appropriate to their settings, strengthening communities “from the ground up.”
They also foster the dignity of individuals and expand opportunities for everyone – including women, youth and the most vulnerable.
They also stimulate local economic growth and bring needed services to under-served areas, levelling the playing field for the individual producer or consumer by aggregating supply and demand.
Among others, they also build bonds of trust among community members and serve as learning labs where their members “develop the habit” of democratic participation and accountability.
The four-study focused on four countries, including Kenya looked at the difference a primary cooperative makes to a member and their respective families.
However, the data show that valued cooperative benefits extend beyond the impacts on income and include social and community advancements.
Most importantly, cooperatives help them to make better decisions, both at home and in their businesses, given the education, training and information imparted to members.
