Abstract

The need for rural households to save is justified in their daily lives and activities as they often sacrifice current needs in order to meet future needs. This study assessed the effects of cooperative membership on rural households’ savings mobilization in Ijebu Zone of Ogun State, Nigeria. Both primary and secondary data were collected and used for the study. 180 household heads were were sampled through well-structured questionnaire and interview schedule using the multi stage sampling technique to selected the respondents. Double hurdle model was used to analyse the data. The probit results showed the respondent’s age (p<0.1); size of household (p<0.1); belonging to a social peer group (p<0.1); and dependency ratio (p<0.05) as significantly affecting household members’ decision to join cooperative groups. As for the Tobit model, sex of respondents (p<0.1); size of household (p<0.1); annual farm income of the household head (p<0.1); membership of a social peer group (p<0.1); household dependency ratio (p<0.05); and nature of household head’s occupation (p<0.1) significantly affected the extent of households’ cooperative participation. Result of the ordinary least square regression revealed that annual farm income (p<0.1) and non-farm income (p<0.01); value of household income generating asset (p<0.01); annual spouse income (p<0.1); and credit obtainable (p<0.1) significantly influenced the volume of household savings mobilized through cooperative membership. Further accesses of cooperative members to income generating assets, as well as a continuous upward review of the total credit obtainable by cooperative members were recommended as means of further enhancing households’ savings ability towards improved rural sector investment opportunities.