Level of members’ satisfaction towards member’s benefits received from credit cooperatives in Malaysia

Abstract

Financing procedures in the cooperatives are seen as less stringent compared to other financial institutions in Malaysia. This have resulted to credit cooperatives having to compete in terms of interest on financing and amount of financing disburse to members. However, credit cooperative in Malaysia has the competitive advantage as cooperative does not only provide its members with financial benefits but also non-financial benefits unlike the financial institutions. Cooperative is a form of business identity which does not only emphasize on bottom line but also to provide benefits to its members member’s well being through providing services. Credit cooperatives in Malaysia can provide easy credit facilities since its credit loan procedures are less stringent compared to other loan providers from other financial institutions in Malaysia. Profit from the credit activities is then distributed to members in the form of financial benefits and non-financial benefits. The well being and satisfaction of cooperatives members are usually measured by the benefits received from their cooperatives. This study aims to examine the level of satisfaction of credit cooperative members with the type of financial and non-financial benefits received by them from their cooperatives. This study is a mixed of qualitative and quantitative method using questionnaire and focus group. Questionnaires were answered by 644 respondents and 10 credit cooperatives were involved in the focus group interview. Studies from this research shows that generally members of the credit cooperatives acknowledge the financial and non-financial benefits they received from their cooperatives. 75% of the respondents agrees that they are satisfied with the benefits received. Studies also shown that the top financial contribution to the members includes dividend payment to the members and benevolence funds given on the death of members or immediate family members. Majority of the respondent agrees that they benefit very much from the welfare funds allocated by their cooperatives specially for the members. Meanwhile non-financial benefits received by most members are in the form of advisory from the cooperatives.