Impact Of Thrift Organization On Economic Well Being Of Individuals And Organization (Case Study Of Enugu State)

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Impact Of Thrift Organization On Economic Well Being Of Individuals And Organization (Case Study Of Enugu State)


This study was undertaken to investigate the impacts of thrift organizations on the economic well-being of individuals and groups in Enugu. The first step was to find out the meanings of thrift means the habit of saving money and carefully spending it so that none is wasted. Organization we discovered means a group of people in business. From this we deduce that thrift organization are a group of persons who encourage people to save money, use money carefully to avoid wasting money. Banks mortgage institution, micro credit institutions were also studied and were found to be thrift organization. After reviewing the opinions of those involved in the informal thrift organizations as well as reviewing relevant literature on the formal ones banks co-operative society, data were collected by way of interviewing, method of data analysis and presentation, sample size and sampling techniques, and instrument for data collection. We found that most potent thrift organizations are the mutual assistance groups organized in towns and villages in Enugu State. In Enugu metropolis, it was found that traders engage in (ISUSU) to help them improve and increase the wars in their shops some buy Cars, Motorcycles etc. we recommended that Government should encourage people though education on radio and television on the benefits of mutual aid assistance to enable more people join the groups.

Table of Content

Preliminary Page(s)

  • Title Page
  • Approval Page
  • Certification
  • Dedication
  • Acknowledgement
  • Table of Content
  • Abstracts

Chapter One

1.0 Introduction

  • 1.1 Background of the Study
  • 1.2 Statements of the Study
  • 1.3 Objectives of the Study
  • 1.4 Significance of the Study
  • 1.5 Research Questions
  • 1.6 Scope of the Study
  • 1.7 Limitations of the Study
  • 1.8 Formulation of Hypotheses
  • 1.9 Definition of Terms

Chapter Two

2.0 Literature Review

  • 2.1 Informal Thrift Organizations
  • 2.1.2 Issue or Traditional or Contributions in the Rural Areas
  • 2.1.2 Issue or Traditional Thrifting in the Urban Areas
  • 2.2 Co-Operative Society
  • 2.2.2 Historical Overview
  • 2.2.3 Co-Operative Movement In Nigeria
  • 2.2.4 Types of Co-Operative Societies
  • 2.2.5 Thrift and Credit Co-Operative Society
  • 2.2.6 Motive For Forming or Joining Co-Operative Society
  • 2.2.7 Factor Influencing Formation C/S
  • 2.2.8 Benefits of Joining Co-Operatives
  • 2.2.9 Court of Appeal Staff Enugu Multipurpose Co-Operative Society Limited Enugu
  • 2.3 Commercial Banks
  • 2.4 Mortgage Institutions
  • 2.5 Micro Credit Institutions
  • 2.6 Insurance Companies
  • 2.7 The Impact of Thrift Organizations On Economics Well Being of the People of Enugu State
  • 2.8 Summary of Review

Chapter Three

3.0 Research Methods

  • 3.1 Research Design
  • 3.2 Area of Study
  • 3.3 Population of the Study
  • 3.4 Sample Size and Sampling Techniques
  • 3.5 Instrument for Data Collection
  • 3.6 Method of Data Collection
  • 3.7 Validation and Reliability of the Instrument
  • 3.8 Method of Data Analysis and Presentation
  • 3.9 Decision Rule

Chapter Four

4.0 Data Analysis and Presentation

  • 4.1 Data Analysis
  • 4.2 Data Presentation
  • 4.3 Discussion

Chapter Five

5.0 Summary of Findings, Conclusion, and Recommendation

  • 5.1 Summary of Findings
  • 5.2 Conclusions
  • 5.3 Recommendations
  • Questionnaire
  • References

Chapter One


We shall begin the consideration of the topic of this project by defining the major concepts in the topic. And these are impact, individuals etc. let us therefore start with the concept of thrift.

1.1 Background of the Study

What is Thrift?

The Oxford Advanced Learners Dictionary define thrifts as the habit of saving money and spending it carefully so that none is wasted.

Encyclopedic world dictionary defines thrift as economical management, frugality and provident on its part. Chambers 20th century dictionary define thrift as the state of thriving, frugality, economy, prosperity, increase of wealth gain, profitable, occupation, savings etc. from these definitions we can deduce that thrift is about saving money and sending money carefully so that none is waste. Thrift is thus the avoidance of waste in the use of money. If follows therefore that thrift increase wealth. It is also concerned with the economic management of resources. From these definitions we are faced with the fact that thrift result in increase of wealth. Let us at this point define organization. Chambers again defines organization variously but the one that is relevant to this study is “a group of people who form a business club etc together in order to achieve a particular aim. Chambers 20th century dictionary defines organization as a body, society etc.”

Encyclopedic dictionary defines organization as a body of persons organized for some end. Combining the definition of thrift and organizations are those business organization for the purposes of saving money and spending money carefully without wasting money.

Since the key word in the definition of thrift as used in this research study is saving money and spending some without waster, we should include in our thrift organizations that institutions that encourage individuals and group to save money. These institutions are, for the purpose of this study, divided into informal thrift organization and formal thrift organization, informal thrift organization.

These will include the locally organized. Contribution by groups of workers, traders, house wives etc. who agree to contribute certain some of money which may be shared among the contributors at the end of an agreed period of time.

The Local name for this is called “ISUSU”, Isusu can also be organization in such a manner that the group contributes certain amount of money for which is collected by a member of the group at the end of every month or week until all the members in the group have receive their contributions. The amount may range from a little as N500 to as much as N100,000 depending on the expected income of members of the group.

To be include in the informal thrift organization on the monthly and daily contribution organization or institutions. Details of the method operation of daily contributions shall be discussed in chapter two. Formal thrift organizations may include the co-operative societies, micro credit institution mortgage institutions, as well as banker.
However, the study will concentrate on the informal thrift organizations and the co-operative society

1.1b Impact and economic well being, impact has been defined as the powerful effect something has on some body or something. Another authority defined impact as influence or effect exerted by a new idea, concept etc. yet another authority defines impact as the impulse resulting from a new idea or theory. Strong, effect, influence etc. The phrase economic well being is not easily defined and to recourse it taken, to as connected with trade, industry and development of wealth of a country’s an area or society, it is also defined as process, a business or an activity etc. Well being is simply define as welfare and welfare is defined as the general health, happiness and safety of a person etc. it follows from the above, that for the purpose of this research we are investigating or studying the influence effect on thrift organization as defined above on the trade, industry and development of wealth and the overall effect on the happiness of individuals and groups in Enugu. The question that should now be posed and answered is that, why the study or the impact of thrift organization on the economic well being of individuals and organization important at even necessary. It is to this question that we shall direct our attention presently.

1.2 Statement of the Problem

There is no doubt that Nigeria is a rich country or at best a potentially rich country. However, the truth is that inspite of the nation’s wealth, majority of our country men and women are poor. According to Karl Maier (2000), half of Nigerian’s 130 million that people live in abject poverty and Okoloagu posits that since Karl Maier conducted his research in the year 200, poverty levels reduce to 300%. Similarly, the limited nations humans development index ranks Nigeria as the Fifth protest country in the world. The fact that Nigerian’s are extremely poor.

However, the view of the obvious excruciating and the apparent mobility, unwillingness of governments at all level to lift the people from poverty, it becomes necessary for individuals and groups to take the initiative to help members out of poverty. Apart from poverty, development requires the mobilization of funds for small and medium scale enterprises. It follows therefore, that for real poverty alleviation programmes since it will provide answers to questions of how to organize individuals and groups to take the respector destines in their own hands. So the researchers want to examine the impact of thrift organization.

1.3 Objectives of the Study

This study will be carried out with the following objectives in view.

  1. To investigate the existence of organization on Enugu.
  2. To investigate the nature and activities of such thrift organization in Enugu.
  3. To examine the level of awareness of the member of the public of the existence of thrift organizations in Enugu.
  4. It members of the public are aware of thrift organization whether the public, especially the Urban, are making adequate and appropriate use of the services of such thrift organization in Enugu
  5. To examine the benefit which individuals and groups derive for the activities of thrift organization provided above, to investigate whether banks qualify as thrift organization in the context of the study.
  6. To examine or determine whether Isusu and daily contribution or monthly contribution organization and groups qualify as thrift organizations.
  7. To determine whether co-operative societies can in described as thrift organizations and if so, to determine the level of encouragement government at all levels are giving to thrift organizations if any.
  8. To suggest area of improvements in the activities of thrift organizations and suggests ways of making more individual aware of the benefits of membership of thrift organization to members of the public especially the rural and urban poor in Enugu.

1.4 Significance of the Study

This study is new in the sense that this is the first time a study of the impact of thrift organization is being examined. Perhaps there has seen so many studies on the impact of co-operative societies the banks primary mortgage institutions, the formal thrift organization, but this is the first time the informal thrift organization are focused on. This study is therefore, not only high light the activities of organizations of Isusu daily and monthly contributions suggest ways of bringing such activities under formal control, so as to protect members of the public especially urban and rural poor on the benefit of organizing thrift organizations. This study will also be useful to government and their agencies involved. The study will be useful to non-governmental organizations involved in poverty alleviation. Students and lecturers of higher institutions who are involved in the study extremely useful as the report will provide answers to the questions posed by paulity of research materials of the oldest from of co-operative (Isusu), which has been practiced in rural villages and towns by farmers, traders, market women, workers their various offices yet no meaningful research which has been done on the activities and impact of this form co-operatives.

Finally the study will increase the body of acknowledge and will provide materials for reference to student and teachers in the area of thrift organization such as co-operative societies etc. The result of this study will open a flood gate for similar studies in the future. Since poverty and its deviating impacts is likely to remain with us for a very long time, the study of institutions and activities geared towards poverty alleviation, eradication or elimination are likely to be interest or hold the attention of researcher for very long times.

1.5 Research Questions

The study will generally be guided by the following question.

  1. What are the thrift organizations?
  2. What are the functions of thrift organization?
  3. Are thrift organizations necessary?
  4. Have they any economic and social relevance to people of Enugu. In other words, are they beneficial and if so how can their activities be improved?
  5. Is poverty a problem in Enugu and if so are thrift organizations important in the war against poverty?
  6. In what ways have individuals and groups benefited or suffered from the activities of thrift organization?

Mobilized for small and medium scale entrepreneur against poverty. Be encouraging the masses to save and pool their resources together. Thrift organizations as defined above will make and have made a huge difference in the lives of rural and urban, poor. The problem is therefore that in the face of government unwillingness or inability to come to the aid of the poor. If is left for the poor to organize themselves, in thrift organization through which they can save small amount of their money in order to lift them selves from poverty by pooling their resources together to establish micro, small and medium scale business units.

1.6 Scope of the Study

The work will cover only Enugu State of Nigeria. It will also study informal financial groups as exemplified by the “Isusu” credit scheme. Emphasis will be placed on these group located in Enugu, Abakaliki, Nsukka and Oji-River Local Government Areas. Ten informal financial groups will be selected from each local government area while small scale business entrepreneurs who will form part of the respondents will be selected from each local government area, for the study.

All the delimitations enumerated above are considered normal for a study of this nature in a developing country like Nigeria, with paucity of information and data. None of them should be considered serious as to invalidate the results.

1.7 Limitations of the Study

Like any other human activity, this study has its limitation and constraints. Due to high cost of materials and increasing transport fares, financial resources constituted a major constraint.

Time considerations and the distance involved in collecting the primary data is another limitation of the study. This is because the time lapse between the end of course work and the submission of the project is greatly inadequate. Moreover interview bias and attitude of respondents constituted a constraint on the researcher as some respondents gave inaccurate information or failed to return their questionnaires.

Another constraint to the study is the same size. Not all the informal financial groups in the local government areas of interest were considered. 40 informal groups and 500 small scale business entrepreneurs chosen for the study do not cover all the groups and people concerned in the study.

Finally, there is a limitation on the generation of the study because the work is a case study of the informal groups in Enugu state. Although the limitation have been high lighted, it is import to state that this will in no way invalidate the findings of the study.

1.8 Formulation of Hypotheses

For the purpose of this study, and in order to give direction for the achievement of the stated specific objectives set by study, four hypotheses were formulated.

The null hypotheses each dealing with a specific objective were formulated. The rejection of the null hypothesis automatically means the acceptance of the alternative hypothesis.

The formulated hypotheses are:

  1. The informal financial groups in Enugu state do not help in the formation of savings habits among members.
  2. The quantum of financial assistance to members by the groups are too small to support any meaningful economic activities.
  3. Members of the informal financial groups do not obtain credit more easily form the groups than from other financial institutions.
  4. The issue of default in the repayment of loans granted is not a major problem for the informal groups.

1.9 Definition of Terms

i. Thrift:

Means saving money and careful spending of money to avoid waste of money.

ii. Organization:

In the context of this study, means individuals and groups that are engaged in thrift business or who are likely to enjoy the benefit of thrifting.

iii. Individuals:

In this context are people who save their money with thrift organization expecting all kinds of benefits from the activities of thrift organizations.

iv. Impact:

Means in the context of this study the effect or influence which the activities of thrift organization is like to make in the economic and social lines of individuals and groups who are members of thrift organization.

v. Well-being:

Means the manifestations in the form of improved economic and social status of individual and groups engaged in thrift as members and organizing etc.

Chapter Five

Summary of Findings, Conclusion and Recommendations


We shall begin the consideration of the topic of this project by summary of findings, conclusion and recommendations.

5.1 Summary of Findings

In their study, we investigated thrift organizations and their impact on the economic well-being of indigenes of Enugu State. The first they we did was to find out what thrift is all about. We found from the research that thrift is all about. We found from the research that thrift is about how to save money and use money carefully without wasting it. From this finding it was clear that numerous groups belong to thrift organizations. We found that most potent thrift organizations are the mutual assistance groups organized in towns and villages in Enugu State we also found that daily and monthly contributions groups in Enugu metropolis are also thrift organizations. And because those groups were organized informally and with intervention of governments and their agencies even at local government level and that these are mostly friendship, community as well as family groups, we called them informal groups.

From our findings it was clear that other self-help groups such as co-operative societies are also thrift organizations, especially, the thrift and loans co-operative societies and thrift and credit societies. In the study we find that co-operative societies exist in Enugu State. We found particular that thrift and loans co-operative societies are very popular in Enugu Metropolis especially among civil servants.

We found that worker in Anamco, Enugu State University of Science and Technology ESUT, Enugu State College of Education Technical, ESCET, and most ministries and Government Departments in Enugu State are members society or another. We found that the court of Appeal has a very thriving of not successful co-operative society. We found that this society which began in the early 1980s was started by junior staff who tried to source ADP Agricultural Loans from the them Anambra State Ministry of Agriculture. It is our findings that the court of Appeal staff multi-purpose co-operative society has grown from the initial Fifteen (15) Junior staff to embrace all members of staff of the court both junior and senior.

It was our findings that the co-operative societies. Funds amount to N1.5 million every month made up members monthly savings and loan and interact repayments. It is our finding that the co-operative society of the court of Appeal staff was duly registered with the relevant government agency responsible for such registration.

It is also our finding that the activities PF banks, mortgage institutions etc also find expression in the term thrift organization, we found that though banks mortgage institutions, are thrift organization they don’t have grass root appeal as the informal groups and the thrift and loans co-operative societies, and thus have little economic impact at the grass root. The findings of the study show that these thrift societies and mutual aid groups have made positive impact on the economic well-being of individuals and organizations in the state. It is the findings of the study that rural dwellers organized mutual assistance groups, Isusu, for several purposes ranging from building houses, buying new agricultural inputs such as seed yams, purchase of bicycles etc.

In Enugu metropolis, it was found that traders engage in Isusu to help them improve and increase the wards in their shops some buy cars, Motorcycles etc.

They also engage in daily and monthly contribution, finally it is the finding of the study that court of Appeal staff by engaging in co-operation have improved their economic well being tremendously. For example it was found that before the establishment of the society, there was no staff that owned a car now there are as much as ten cars bought by members from loans soured from the society. Two members have completed their own motorcycles. Many more have paid school fees for themselves and others have trained their children and wards up of to tertiary institution level.

This researcher benefited as she financed her six-year programme entirely from loans from the court of Appeal staff multi-purpose co-operative society limited.

5.2 Conclusions

From the finding above we conclude that thrift organizations, both formal and informal, are self help organizations, that the informal or the traditional mutual assistance groups have been in existence on Enugu State over the years and have help rural communities and urban dwellers save money and source loans for various projects that impact on the economic well-being of the people. From our findings in the study, we also conclude, co-operative societies, especially the thrift loans societies are veritable instruments for economic development. This is because by helping individuals and groups to save, and by granting them loans make life better and easier for their members. We conclude that banks also contribute to improve economic well being because they encourage savings and grant loans to big business men who in turn provide employment through their business activities.

5.3 Recommendations

From our findings and conclusion, we make the following recommendations.

  1. Government should encourage people through education on radio and television on the benefits of mutual aid assistance to enable more people join the groups.
  2. Government should regulate the activities of daily and monthly contribution agents and their collectors.
  3. Government should make law that provide for stiff penalties for management committee members who embezzle cooperative societies funds.
  4. Government should make banks extend loan facilities to the grass root i.e. rural and urban poor without the need for heavy collaterals.
  5. Government should set up mortgage institutions to enable civil servants and interested members of the public save towards the building of their own personal house.
  6. Government should also establish micro-credit institution.
  7. Government should intensive its campaign to encourage people to from thrift and loans cooperative societies.
  8. Churches should also encourage members to form or join mutual aid groups and groups and cooperative societies as was done by reverend father for teachers in Abeokuta many years ago.

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