5.3 Methods in action
5.3.4 Nominal group technique
Table 8: Grain Traders’ Membership in different Types of Local Level Institutions
Local level institutions Grain traders number % of Total
Traders‘ associations/business group 403 26.9
Cooperative societies 250 16.7
Credit/finance group (formal) 117 7.8
Religious group 214 14.3
Cultural association 64 4.3
Gender association 90 6.0
Political group 110 7.3
NGOs 33 2.2
Trade union 58 3.7
recreational group 13 0.9
Age group 45 3.0
Social service group 104 6.9
Total 1501 100.0
Source: Field Survey 2011
4.2.2 Membership Density, Heterogeneity and Decision Making Indices of Grain Traders by Access to Credit
Table 9 presents membership density, heterogeneity and decision making indices of grain traders by access to credit. The result shows that each grain trader, belong to an average of three associations. However, for the traders with membership density of greater than 4, the highest belonged to ROSCAS while the least belonged to cooperatives.
Heterogeneity index of traders in associations shows that almost forty percent of the traders that were in 61-80% subgroup had the highest heterogeneity index. Across different credit groups, there is small variation in heterogeneity index. Community association had the highest (76.4%), while the least was from cooperative (65.6%).
Considering this, it could be explained that individual in cooperative must have good knowledge of intended borrowers. With grain traders mean heterogeneity index of about 70.0%; associations in the study area were considered diverse. The greatest diversity was found among traders that sourced their credit from community association.
Decision Making Index (DMI) is moderate in all the credit sources with an average of 66.3%. Members participate in three out of five of decisions affecting their associations.
The result supports Balogun (2011) that clients of microcredit institutions in rural southwest participate in three out of the five decisions in their associations. Decision making process is highest in the ROSCAS and lowest in the microfinance bank.
Table 9: Membership Density, Heterogeneity and Decision Making Indices of Grain Traders
Traders Community Cooperative ROSCAS Friends and Relatives
Banks Pooled
Variable % % % % % % %
Membership density
1 12.0 11.1 10.1 8.7 20.5 3.7 11.5
2 25.9 22.2 23.6 13.1 27.3 29.6 24.7
3 27.1 22.2 35.8 30.4 22.7 37.0 30.5
4 22.9 33.3 20.3 34.8 18.1 18.5 22.1
>4 12.0 11.2 10.2 13.0 11.4 11.2 11.2
Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0
Mean 3.0 2.0 3.0 3.0 3.0 3.0 3.0
SD 1.2 0.0 1.2 1.1 1.3 1.1 1.2
Minimum 1 1 1 1 1 1 1
Maximum 5 5 5 5 5 5 5
Heterogeneity Index %
1-20 00.0 00.0 00.0 0.0 0.0 0.0 00.0
21-40 00.0 00.0 00.0 0.0 0.0 0.0 00.0
41-60 34.4 00.0 46.9 36.4 38.5 33.3 34.6
61-80 43.7 50.0 39.8 27.3 30.7 42.9 37.6
>80 21.9 50.0 13.3 36.4 30.8 23.8 27.9
Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0
Mean 68.4 76.4 65.6 68.8 71.8 67.7 69.9
SD 11.7 8.0 11.2 12.8 13.9 11.5 13.5
Minimum 50.0 65.0 50.0 52.0 56.0 50.0 50.0
Maximum 89.0 83.0 100.0 83.0 100.0 85.0 100.0
Decision Making Index %
1-20 00.0 00.0 00.0 0.0 0.0 0.0 00.0
21-40 00.0 00.0 00.0 0.0 7.7 15.5 0.2
41-60 00.0 16.7 26.5 30.0 7.7 74.5 22.7
61-80 34.4 83.3 69.9 60.1 84.6 10.0 74.6
>80 65.6 00.0 3.6 9.9. 0.0 20.0 2.6
Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0
Mean 64.2 64.8 66.3 68.7 64.1 57.1 66.3
SD 7.3 4.5 8.9 11.9 10.3 25.5 8.9
Minimum 55.0 56.0 56.0 56.0 33.0 20.0 56.0
Maximum 77.0 67.0 100.0 89.0 78.0 100.0 100.0
Source: Field Survey 2011
4.2.3 Meeting Attendance Index, Cash Contribution and Labour Contribution of Grain Traders by Access to credit
Meeting attendance index, cash contribution and labour contribution of grain traders by access to credit is presented in Table 10. Grain traders attended over 80% of association meetings per annum. Much importance is attached to meeting attendance because it shows some levels of commitment. Majority of the grain traders (62.7%) had greater than 80.0% meeting attendance index while the subgroup 1-20% had less than 1.0% meeting attendance. On the average grain traders have meeting attendance index of between 87.0% and 90.4% across the different sources of microcredit.
Cash contributions are made by traders to their associations. Part of this savings was used for the general running of the associations while part was loaned as microcredit to members, who signified interest for loans. Cash contribution was generally low across the different credit sources. Majority of the grain traders (55.17%) paid cash contribution of between N501 and N1000 per month while the least (1.4%) paid cash contribution of greater than N3000 per month. This might be because these institutions required some level of commitment with them before individuals or the group could be considered for credit. However, grain traders that have Microfinance Banks funding their businesses made the highest contribution to their associations whereas those with Traders Association contributed the least to their association.
Some associations require some form of labour activities from their members towards the development of the associations and their communities. Active members are usually recognized and considered when they require assistance from the associations.
Majority (57.6%) of the grain traders contributed about 1- man-day per month, while only 0.20% contributed more than 4- man-day per month. Grain traders that sourced credit from traders association, community association, cooperatives, ROSCAS, friends and relatives and microfinance bank contributed 1.06, 1.76, 1.32, 1.40, 1.71, and 1.57 man-days per month of labour to their associations respectively. Labour contribution was low in the study area. This may have adverse effect on the sustainability of these institutions.
Table 10: Meeting Attendance Index, Cash Contribution and Labour Contribution of Grain Traders
Traders Community Cooperative ROSCAS Friends and Relatives
Banks Pooled
Variable % % % % % % %
Meeting Attendance Index %
1-20 0.00 33.33 1.03 0.00 0.00 0.00 0.81
21-40 0.00 16.67 1.54 0.00 0.00 4.76 1.22
41-60 0.00 33.33 4.62 0.00 23.08 4.76 3.87
61-80 9.09 16.67 28..72 9.09 15.38 19.05 31.36
>80 90.91 0 64.10 90.91 61.54 71.43 62.73
Total 100.0 100.0 100.0 100.0 100,0 100.00 100.0
Mean 87.01 89.03 87.03 90.41 82.94 81.7 84.3
SD 12.56 6.16 16.11 9.01 17.16 10.0 12.3
Minimum 60.0 83.0 30.0 71.0 57.0 24.0 30.0
Maximum 100.0 100.0 100.0 100.0 100.0 100.0 100.0
Cash
Contribution (N)
1- 500 31.18 50.00 21.33 8.70 4.48 5.56 20.08
501-1000 62.94 40.00 57.33 56.52 43.28 45.83 55.17
1001-2000 4.71 10.00 10.67 21.74 40.30 26.39 15.62
2001-3000 1.18 0 8.67 4.35 11.94 19.44 7.71
>3000 0 0 2.00 8.70 0 2.78 1.42
Total 100.0 100.0 100.0 100.0 100.0 100.00 100.0
Mean 636.06 650 927.67 1178.26 1206.72 1289.58 924.91
SD 290.49 317.11 661.51 892.37 620.23 748.52 628.90
Minimum 300 300 250 300 400 400 250
Maximum 2400 1300 4000 3500 2500 3200 4000
Labour contribution (man days)
0-1.0 77.06 20.0 62.00 47.83 22.39 44.44 57.61
1.1-2.0 15.29 60.0 20.00 26.09 55.22 30.56 25.76
2.1-3.0 3.53 20.0 12.67 21.74 13.43 18.06 11.16
3.1-4.0 4.12 0 5.33 4.35 8.96 5.56 5.27
>4.0 0 0 0 0 0 1.39 0.20
Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0
Mean 1.06 1.76 1.32 1.40 1.71 1.57 1.34
SD 0.72 0.69 0.90 0.98 0.86 1.03 0.89
Minimum 0.5 1 0.5 0.38 0.50 0.5 0.38
Maximum 4 3 4 3.38 3.88 5.25 5.25
Source: Field Survey 2011
4.2.4 Trust and Cohesion Indices of Grain Traders by Access to Credit
Trust and cohesion indices of grain traders, by access to credit are presented in Table 11. Trust which may be understood as an optimistic expectation or belief regarding other agents‘ behavior is generally low among the grain traders. Grain traders in the study area had average trust index ranging from 44.6% to 63.7%. Grain traders that accessed their credit from ROSCAS had highest (63.7%) trust index while the grain traders that accessed their credit from banks had the lowest (44.6%) trust index in the study area.
Cohesion index are also generally low among the grain traders. Social cohesion has to do with ability to secure the long-term well being of traders. Grain traders in the study area have average cohesion index ranging from 39.6% to 65.3%. Grain traders that accessed their credit from community association have highest (65.3%) cohesion index while the grain traders that accessed their credit from traders‘ association have the lowest (39.6%) cohesion index in the study area.
Table 11: Trust and Cohesion indices of grain traders Trust
Index %
Cohesion Index % Traders‘
Association
50.9 39.6
Community 57.3 65.3
Cooperative 57.8 51.2
ROSCAS 63.7 55.3
Friends and Relatives
57.5 53.2
Banks 44.6 46.0
Pooled 53.7 47.5
Source: Field Survey 2011
4.3 Credit Financing Activities of the Grain Traders