Premium
Combating financial exclusion through co‐operatives: is there a role for external assistance?
Author(s) -
Rogaly Ben
Publication year - 1998
Publication title -
journal of international development
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.533
H-Index - 66
eISSN - 1099-1328
pISSN - 0954-1748
DOI - 10.1002/(sici)1099-1328(1998090)10:6<823::aid-jid558>3.0.co;2-t
Subject(s) - business , finance , social exclusion , financial system , development economics , economics , economic growth
Despite the decline of the large British mutuals and the poor record of aid‐funded and government‐managed co‐operative credit institutions internationally, there has recently been renewed policy interest in using co‐operatives to combat exclusion from access to financial services. This article examines the relation between the governance and the performance of eight different types of co‐operative financial institution, highlighting in each case the institution's specific links with external organizations. Co‐operative governance varies greatly, is influenced by the nature of external assistance, and has an impact on performance. Available evidence suggests that scale of outreach is related to financial viability but that excessive concern with these two goals can have negative consequences for the depth of outreach. However, mutuality in governance can be exclusive and does not necessarily lead to greater depth of outreach either. The article ends with conclusions as to how public sector and international organizations can best enhance co‐operatives' capacity to increase access to financial services. © 1998 John Wiley & Sons, Ltd.