ABSTRACT
BIBLIOGRAPHY
AGUSTIN, FRANKLIN B. APRIL 2007. Practices and Perceptions of Member-
borrowers of Bad-ayan Buguias Development Multipurpose Cooperative Towards Loan
Borrowing and Repayment. Benguet State University, La Trinidad, Benguet.
Adviser: Florentino B. Landacan Jr.
ABSTRACT
The study was conducted mainly to determine the practices and perceptions of the
member-borrowers of BABUDEMPCO towards loan borrowing and repayment. The
study was conducted from January to February 2007.
The total numbers of respondents in the study were one hundred member-
borrowers of BABUDEMPCO.
It was found out that most of the respondents are farmers, thus, an agricultural
loan is the most type of loan availed loan by the member-borrowers.
As to the practices of member-borrowers towards loan borrowing, most of the
respondents were able to prepare project proposals, consulted their family members when
they borrowed from the cooperative, personally read and understood all the details in the
loans agreement, explained what responsibilities of their co-makers are. Most of the loans
of the respondents were actually used to the purpose intended for. On loan repayment,
most respondents preferred to ask the cooperative to restructure their loans if they could
not settle their loan on time. Most respondents responded to the reminders or notice
letters coming from the cooperative promptly. As to their payments, most respondents
brought them personally to the cooperative.
On the other hand, as to the perceptions of member-borrowers towards loan
borrowing and repayment, the respondents mentioned that borrowing from the
cooperative is a way of patronizing its services being offered. They also give positive
remarks to the staff. The respondents were satisfied with the services rendered by the
staff. The time consumed by the cooperative in processing the loan is perceived by most
of the respondents as just enough.
The problems mostly encountered by the respondents affecting their loan
repayment are low prices of their produce and they live far from the cooperative that they
have a hard time going to the cooperative.
The respondents recommend that the cooperative must conduct regular
information dissemination for their loan policies, continuous education of the member-
borrowers on their duties and responsibilities; a regular monitoring on the project of the
member-borrowers, officers and staff should always be good models by paying their
loans on time also, their must be rewards or incentives given to member-borrowers who
pay their loans in advance and the staff should undergo trainings on loan processing and
effective collection.
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TABLE OF CONTENTS
Page
Bibliography ………………………………………………………………….
i
Abstract …………………………………………………………………………..
i
Table of Contents …………………………………………………………
iii
INTRODUCTION
Rationale ……………….…………………………………………………
1
Statement of the Problem ……………………………………………..
3
Objectives of the Study ……………………………………….............
3
Importance of the Study ………………………………………………
4
Scope and Limitation of the Study …. …………………………………
4
REVIEW OF LITERATURE
Loan Practices of Borrowers that
Led to Loan Delinquency………………………………………………….
5
Practices that can Contribute to
Cooperatives Success……………………………………………………...
5
Perceptions………………………………………………………………..
6
Loans……………………………………………………………………….
6
Inability to Repay………………………………………………………….
7
Problems in the Collection of Loans………………………………………
7
Definition of Terms……………………………………………………….
8
METHODOLOGY
Locale and Time of the Study ……………………………………….
9
Respondents of the Study ………………………………………………
9
iii
Data Collection ………………………………………………...............
9
Data Gathered …………………………………………………………….
9
Data Analysis ………………………………………………………….
11
RESULTS AND DISCUSSION
Brief Information on the Cooperatives ………………………...............
11
Practices of the Member-Borrowers in
Borrowing Loan in the Cooperative……………………….........................
13
Practices of the Member-Borrowers in
Repaying Loan in the Cooperative……………………….........................
20
Respondents’ Perception on
Borrowing From the Cooperative ………………………………………..
24
Respondents’ Perception on Loan Repayment .........................................
28
Problems Encountered by Member-Borrowers that
Affect Their Performance in Loan Repayments………………………….
31
Respondents’ Recommendations for Improving
Their Attitudes and Perceptions on Loan
Borrowing and Repayment………………………………………………..
33
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
Summary …………………………………………………….................
35
Conclusions …………………………………………………................
37
Recommendations ……………………………………………………..
38
LITERATURE CITED …………………………………………………….
40
APPENDICES
Appendix A. Letter to the Respondents………………………………….
41
Appendix B. Survey Questionnaire………………………………………
42
iv
1
INTRODUCTION
Rationale
A cooperative is primarily organized to provide the necessary common needs of
its members that improve and uplift their living condition within the context of the
universally accepted cooperative principles of membership, democratic administration,
equitable contribution, savings disposal, education and inert cooperative cooperation
(Mendoza, 1980). It is also a way of easing financial inadequacy of its members through
loans with minimal rates for provident and productive purposes.
Most farmers who need funds for their production organize cooperatives. In 1967,
there was a group of 35 people in Buguias, Benguet who pooled their resources to
establish a Credit Union. It was named as Bad-ayan Credit Union. On July 10, 1968, it
was registered with the Cooperative Administration Office (CAO) with a Certificate of
Registration No. 001964 under the Republic Act No. 2023. However, the association
became dormant for a period of five years.
On October 1971, the association was re-organized wherein a series of
membership seminars was conducted to refresh the old members regarding the
importance of credit union. On May 10, 1976, the credit union was registered as a
precooperative under the Bureau of Cooperative and Development thereby mandated to
elect its set of Board of Directors and committee members. It adopted the name Bad-ayan
Credit Cooperative Union, Inc. The cooperative operated fruitfully thus, they were able to
acquire land and built an office for the Cooperative Union in 1982.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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On May 22, 1989, the Bad-ayan Credit Union Inc. was renamed as Bad-ayan
Buguias Development Cooperative, Inc. with Registration No. CAR ff-009 under the
Office of Bureau of Agricultural Cooperative Development. Finally, on October 18,
1994, the cooperative amended its name to Bad-ayan Buguias Development Cooperative
(BABUDEMPCO) that becomes its name until the present. The said amendment was
done in response to the memorandum from the CDA calling cooperatives registered
under the RA 6938 to drop the word incorporated.
Just like other cooperatives, BABUDEMPCO has experienced difficulties in its
operation that nearly lead to its bankruptcy. Like in 1990 during the killer Earthquake,
their members’ products were destroyed that resulted to the decline of their income. With
this, the members were not able to repay their loans to the cooperative and there were no
deposits generated from the members. Nevertheless, because of the financial assistance
from some local and international institutions, the cooperative was able to stand with its
feet again and it continued to grow until now.
At present, the cooperative has a total membership of 3, 997 composed of 1,628
regular members and 2,369 associate members. It operates in the whole municipality of
Buguias, Benguet. Credit is one of its services and like many credit cooperatives
organized in the country, BADUDEMPCO has been experiencing problems on its
lending operation. In fact, it was not able to establish a satisfactory track record in its
lending operation. As of July 2006, about 1,029 member-borrowers availed of loans from
the cooperative.
The member-borrowers have a vital role in making the credit operation of the
cooperative a success. If members used their loans in a proper way, then they could be
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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able to pay their loans on time to the cooperative. This only means that one of the main
factors to look on is the member-borrower’s practices and perceptions regarding
borrowing and repayment of his loans. This is what the study intended to determine.
Statement of the Problem
Specifically, the study was conducted to find the answers to the following
questions:
1. What are the types of loan being offered by the cooperative that are mostly
availed of by the member-borrowers?
2. What are the practices of member-borrowers towards loan borrowing and
repayment?
3. What are the perceptions of member – borrowers towards loan borrowing and
repayment?
4. What are the problems encountered by the member-borrowers that affect their
performance in loan repayment?
5. What are the solutions to the problems identified?
Objectives of the Study
The objectives of the study are as follows:
1. To determine the types of loans being offered by the cooperative that are
mostly availed of by the member-borrowers;
2. To determine the practices of member-borrowers towards loan borrowing and
repayment;
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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3. To determine the perceptions of member-borrowers towards loan borrowing
and repayment;
4. To find out the problems of the member-borrowers that affect their
performance in paying their loans to the cooperative; and
5. To recommend possible solutions to the problems identified.
Importance of the Study
The results of this study could be used by the cooperative as a basis in
formulating and strengthening the implementation of its loan polices.
Moreover, the results of the study could be used as a guide for the cooperative in
planning and conducting the necessary activities or programs that would improve the
attitudes and perceptions of the member-borrowers towards borrowing and repaying their
loans which could generally improve their performance in the cooperative.
Students or any researcher planning to conduct related studies could use the
results of this study.
Scope and Limitation of the Study
This study mainly concentrates on determining the practices and perceptions of
the member-borrowers of Bad-ayan Buguias Development Multipurpose Cooperative
towards borrowing and repayment of their loans and the problems affecting the member-
borrowers’ performance in paying their loans. The study was conducted from January to
February 2007.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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REVIEW OF LITERATURE
Loan Practices of Borrowers that
Led to Loan Delinquency
Taganas (1979) found out that the failure of farmers to pay loans on time at
maturity was caused by diversion of loan to non-farm activities. This was due to late
release of the loan which motivated them to divert it to purpose other than the intended
purpose. As a result, nothing was used on the intended purpose. This further resulted to
the extent of selling their house, lands just to augment the amount needed for land
preparation and other expenditures. Others sold their houses to pay their debts when the
collateral used was forfeited.
Practices that can Contribute to
Cooperative Success
Fajardo and Abella (1990) mentioned several factors that have been contributing
to the success of cooperatives in the past. The following factors were as abed on a survey
of successful cooperatives in the country: 1) continuous training and education of the
officers, members and employees, 2) Appropriate and adequate organizational structures
to cope with the varying and increasing needs and problems of the cooperative members
and the community, 3) Progressive and people-oriented on loan savings, education,
management and community development, 4) Presence of effective, honest and dedicated
cooperative and community leaders, 5) Active involvement and participation of officers
and members in the affairs of their cooperatives and the community, 6) Trust and
confidence in cooperative officers, 7) Dependence on self-help process in achieving their
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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programs and projects, 8) Wise election of cooperative officers, 9) Spirit of cooperation
and camaraderie prevails among the officers, members and employees of the cooperative,
10) Efficient service for the promotion of social and economic advancement of
cooperative members, good public relation and 11) availability of competent and honest
managers.
Perceptions
In psychology and the cognitive science, perception is the process of acquiring,
interpreting, selecting, and organizing sensory information.
Taylor (1970) found out that one’s perception is of a certain thing that determines
the overt behavior exhibited under a given condition. Perception is the process of
becoming aware of objects, qualities, relation or problems by way of the sense organ
which is closely related to actions. He concluded also that an individual’s perception
affects his behavior and how he perceives a situation.
Loans
For many years, cooperative has been always there to help. It’s just absolutely
impossible to think how men survived through ages if they did not help one another.
History books now tell us that cooperativism has been a practice since before. But
today’s modern world, there was a great improvement in cooperative operation. One
great improvement is loan assistance to members.
Simple definition of loan is the act of lending and/or lending with an interest. A
member loans out money for many purposes such as production purposes, for buying
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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facilities and equipment needed in the farm, or family expenses during the period
between planting and harvesting of crops for farm improvement and for other purposes
(World Book Encyclopedia, 2004).
Inability to Repay
According to Sacay (1985), sheer poverty seemed to be the primary root cause of
delinquency. The common rural folks had become heavily indebted because they needed
credit to cover up their chronic cash deficit and sustain their subsistence level of
expenditures.
Block and Hirt (1987) also stated that people with low level of formal education
would inherently be a poor credit risk. The TBAK observation shows the importance of
providing for a sustained education campaign to ensure that member-borrowers are
sufficiently informed on the ways and practices of the cooperative especially with respect
to credit and obligation to pay back their loan.
Problems in the Collection of Loans
Delinquent loans in cooperatives are due to circumstances which if not properly
managed will result to tremendous financial set back and loss of confidence of member-
borrowers in the cooperative’s lending services.
Macaranas (1994) stated that loan delinquency has always been a big problem
among cooperatives and the failure to recognize this problem and institute the necessary
remedy led to the demoralization of both members and officers and ultimately to the
failure of the cooperative.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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Definition of Terms
Perceptions. The process of becoming aware of objects, qualities, relations or
problems by way of the sense organ that is closely related to actions.
Credit. It refers to the engine of socio-economic upliftment of big and small
entrepreneurs of the rural poor.
Loan. An amount of money given to somebody on the condition that it will be
paid back later.
Capacity. Refers to borrower’s ability to pay back the sum borrowed based on his
or her earning capacity.
Loan repayment. It is an extinguishing liabilities.
Delinquent. It refers to a member-borrower’s loan accounts have experienced
difficulties whose full collection of principal and interest are doubtful.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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METHODOLOGY
Locale and Time of the Study
The study was conducted at Bad-ayan Buguias Development Multi-Purpose
Cooperative located at Buguias, Benguet, which is widely known as one of the major
producers of high yielding vegetable varieties in the province. Figure 1 shows the locale
of the study. The study was conducted from January to February, 2007.
Respondents of the Study
The respondents of the study were the member-borrowers of Bad-ayan Buguias
Development Multi-purpose Cooperative with loans that are classified as current
accounts. One hundred respondents were randomly chosen from the list of borrowers
provided by the cooperative.
Data Collection
A survey questionnaire was used as the instrument in gathering the information
and data needed in the study. An interview was also done with the manager of the
cooperative and some of the respondents for additional information.
Data Gathered
The data gathered were the practices and perceptions of the member-borrowers of
Bad-ayan Buguias Development Multipurpose Cooperative towards loan borrowing and
repayment.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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Data Analysis
The data was tabulated, analyzed and interpreted according to the objectives of
this study using the descriptive statistics like frequency and percentage methods.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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RESULTS AND DISCUSSION
Brief Information on the Respondents
Table 1 presents the occupation, number of loan and total loans availed of by the
respondents from the cooperative.
Occupation. Sixty-two of the respondents are farmers, 12 respondents are working
in government offices, seven are employees of the cooperative, and 10 respondents are
laborers. A Few of the respondents are businesspersons and housekeepers. The results
show that most of the respondents are involved in farming.
Types of loan mostly availed of by the respondents. The cooperative offers the
following types of loan: agricultural loan, emergency loan, educational loan, salary loan,
commercial loan and industrial loan. As shown in Table 1, 84% of the respondents
availed of the agricultural loan while a few (27%) of the respondents availed of the
emergency loan. Only very few of the respondents availed of the other types of loans.
The results show that agricultural loan is usually availed of by most of the
respondents for the reason that most of the respondents are farmers. Agricultural loan is
for procurement of farm inputs, improvement of farms, marketing of farm products and
others.
Number of times the respondents have availed of loans. Fifty percent of the
respondents had already availed of loans more than thrice from the cooperative; 26%,
twice; 17 respondents, first time to borrow from the cooperative and seven respondents,
third time to borrow from the cooperative.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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The result implies that most of the respondents established a long credit
relationship with the cooperative. This also means that most of the respondents
performed well in their payments thus the cooperative was able to give them another loan
after satisfying their previous loan.
Table 1. Occupation, types of loans mostly availed of by the member-borrowers and
number of times the member-borrowers availed of loans in the cooperative
PARTICULAR
FREQUENCY
PERCENTAGE (%)
Occupation
Farmers
62
62
Cooperative Employees
7
7
Government Employees
12
12
Businessmen
3
3
Laborers
10
2
Housekeepers
6
6
TOTAL
100
100
Types of loans availed of by the member-
borrowers
Agricultural Loan
84
84
Emergency Loan
27
27
Educational Loan
7
7
Salary Loan
6
6
Commercial Loan
4
4
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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Table 1… continuation
PARTICULAR
FREQUENCY
PERCENTAGE (%)
Industrial Loan
3
3
TOTAL
131
Number of times the respondents have
availed of loans in the cooperative
Once
17
17
Twice
26
26
Thrice
7
7
More than thrice
50
50
TOTAL
100
100
Practices of the Member-Borrowers in
Borrowing Loans in the Cooperative
Number of respondents who prepare project proposal. Project proposal is
prepared to determine the various activities to be done in carrying out the project and
generally, to determine the feasibility of the project to be undertaken.
Table 2 presents that most (77%) of the respondents prepared project proposal
before borrowing from the cooperative. The remaining 23% of the respondents did not
prepare project proposal because of lack of knowledge to do it. According to them, the
project proposal was not also a compulsory requirement for availing of loans from the
cooperative. The result shows that a great majority of the respondents planned carefully
where they would invest their loans. Therefore, when their loan is released they know
already where to spend and how to spend it.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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Table 2. Response of the respondents as to whether they prepare project proposal
RESPONSE
FREQUENCY
PERCENTAGE (%)
Prepared project proposal
77
77
Did not prepare project proposal
23
23
TOTAL
100
100
Number of respondents consulting their family members when borrowing. Table
3 shows that 91% of the respondents have consulted their family members before they
borrowed from the cooperative while 9% of the respondents did not consult their family
members.
This means that majority of the family members have a knowledge or idea about
the loan availed of by the respondents. The family members could be the spouse, children
or parents of the member-borrowers. A great percentage of those who consulted their
family members is attained since the cooperative has required the member-borrowers to
let their spouses sign the loan papers especially when conjugal properties are offered as
collateral to the cooperative.
Number of respondents who read and understood the loans agreement. Table 4
presents the number of respondents who read and understood the loans agreement before
signing it. Loan agreement refers to the promissory note and other released papers that
the borrower has to read and sign before the cooperative could release the loan.
Most (61%) of the respondents said that they personally read and understood
every detail written in the loan agreement. Thirty (30%) of the respondents said that they
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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just filled-in the information required in the loan agreement and submitted it to the
cooperative. Whereas, 9% of the respondents cannot read so they let someone to fill-up
the information without explaining the contents to them.
The result shows that most of the member-borrowers cared to read and understand
the contents of the loan agreement before filling-up the required information and finally
submitting it to the cooperative. With this, they were aware of the terms and conditions of
their loans such as their due date, amortization, and the penalty or surcharge for not
paying on time and others related to their loans.
Number of respondents who explained the responsibilities of their co-makers. The
borrowers are required to have co-makers to sign the loan agreement and even to appear
at the cooperative during the release of the borrower’s loan. The co-makers are
understood to have responsibilities in the loans of the borrower, as they could be the ones
to pay when the borrower will not be able to pay the loan.
Table 5 shows the number of the respondents who explained what the
responsibilities of their co-makers are. Eighty (87%) of the respondents said that they
explained what are the responsibilities of being their co-makers or guarantors whereas
only 13 or 13% of the respondents said that they did not explain the responsibilities of
their co-makers since they assumed that they already know it.
The result shows that most of the respondents informed their own co-makers of
their responsibilities.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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Table 3. Response of the respondents as to whether they consult their family members
when borrowing
RESPONSE
FREQUENCY
PERCENTAGE (%)
Consulted family members
91
91
Did not consult family members
9
9
TOTAL
100
100
Table 4. Response of the respondents as to whether they read and understood the loan
agreement
RESPONSE
FREQUENCY
PERCENTAGE (%)
Personally read and understood it
61
61
Just fill-in the information required and
30
30
submit in the cooperative
Did not read it
9
9
TOTAL
100
100
Table 5. Response of the respondents who explained the responsibilities of their co-
makers
RESPONSE
FREQUENCY
PERCENTAGE (%)
Explained
87
87
Did not explain
13
13
TOTAL
100
100
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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Number of respondents who actually used their loans for the intended purpose.
One information contained in the loan application is the purpose of the borrower for
loaning. The purpose written by the borrower in the application form must be carried out
once the loan is approved and released.
Table 6 shows the number of respondents who really used their loans for what
they have stated in their loan application. Almost all (97%) of the respondents said
that they actually used their loan in the purpose they have stated in their loan application
whereas only 3 or 3% of the respondents said that they diverted it to other purposes
others than what they have originally stated in their loan application.
Moreover, most of the respondents used their loans for procurement of farm
inputs since most of them are farmers and some used it for educational purposes like for
paying the tuition fees of their children and other school needs. Few respondents used
their loans for buying medicines or seed capital for business and others.
The result shows that the respondents knew how to follow or implement honestly
the purpose they have stated in their application form.
Table 6. Response of the respondents as to whether they used their loans for the intended
purpose
RESPONSE
FREQUENCY
PERCENTAGE (%)
Used for the intended purpose
97
97
Did not use for the intended purpose
3
3
TOTAL
100
100
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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Number of respondents who used immediately their loans for their project. The
loan, upon release from the cooperative should be used in the project immediately. This
practice of putting immediately using the project to the project would spare the borrowers
from spending their loans for other purpose or being subjected to misspending or even
losing the money. With this, Table 7 shows the number of respondents who utilized
immediately their loans for their planned project.
It is noted that almost all (96%) of the respondents revealed that as soon as their
loan was released, they used it immediately for their project while very few or (4%) said
they waited for weeks before finally using their loan.
This shows that most of the respondents planned already where to put their loans.
This confirms that most of the respondents prepare project proposal on where and how to
spend their loan.
Table 7. Response of the respondents as to whether they used their loans immediately for
their project
RESPONSE
FREQUENCY
PERCENTAGE (%)
Immediately Used
96
96
Not Used Immediately
4
4
TOTAL
100
100
Number of respondents who borrowed only from the cooperative. Table 8 shows
the number of respondents who availed of loans only from the cooperative. Sixty-six
percent of the respondents said that they only availed of loans from the cooperative.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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Whereas, thirty-four percent of the respondents loaned-out from other lending institutions
aside from the cooperative. They reasoned out that they were forced to borrow from other
sources since they were given a small amount by the cooperative which is not enough to
finance their projects.
The result reveals that most of the respondents made the cooperative as their only
source of loans thus; there is greater probability that they could be able to pay their loans.
Table 8. Response of the respondents as to whether the cooperative is the only source of
their loan
RESPONSE
FREQUENCY
PERCENTAGE (%)
Borrowed exclusively from Coop
66
66
Borrowed from other Sources
34
34
TOTAL
100
100
Number of respondents who have savings deposits in the cooperative. Table 9
shows the number of respondents who have made savings deposit in the cooperative that
they could use it as payments for their loans.
Out of the 100 respondents, 94 said that they deposited their savings in the
cooperative. Some of them even deposited their daily collections from their business and
withdrew it upon their payment time. Some respondents said that they were not able to
have savings deposit on a regular basis but once they had extra money, it surely went to
the cooperative. Only four respondents answered that they never had savings deposit in
the cooperative. The results show that most of the respondents knew how to save in the
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
20
cooperative, which they could use it as payments for their loans. On the other hand, the
cooperative is at least comfortable since there are savings of its member-borrowers that
could be frozen and withdrawn if they could not be able to pay their loan.
Table 9. Response of the respondents as to whether they are having savings deposit in the
cooperative
RESPONSE
FREQUENCY
PERCENTAGE (%)
With savings deposit in the coop
94
94
Without savings deposit in the coop
6
6
TOTAL
100
100
Practices of the Member-Borrowers in
Repaying Loans in the Cooperative
Number of respondents who followed their mode of payment as stated in the loan
agreement. Table 10 shows the number of respondents who followed the mode of their
payment. Sixty-two of the respondents said sometimes, 37 respondents answered always
and only one respondent said never.
The result tells that most of the respondents do not pay regularly when they have
to pay and only few of them followed their schedule of payment, like monthly or weekly.
Number of respondents who maintained a record of their payments. Table 11
shows the number of respondents who had their own record of their payments.
It is noted that majority (81%) of the respondents kept records of their payments.
According to them, they recorded every payment they made to the cooperative in their
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
21
notebooks and they compare their loan balances as reflected in their notebook to the
record on the cooperative. With this, they could easily track down if there are
discrepancies. Whereas, only few (19%) of the respondents did not have records of their
own payments, they trusted that their payments were properly accounted for so they just
relied on the records of the cooperative and the official receipts they were keeping.
The results show that the most of the respondents are very concern on their
payments thus, they have records of their own payments. This is a way also of identifying
if errors are incurred by comparing the balances from the borrower’s record with that of
cooperative’s record.
Table 10. Response of the respondents as to whether they follow their mode of payment
RESPONSE
FREQUENCY
PERCENTAGE (%)
Always
37
37
Sometimes
62
62
Never
1
1
TOTAL
100
100
Table 11. Response of the respondents as to the way they recorded their own payments
RESPONSE
FREQUENCY
PERCENTAGE (%)
With personal records
81
81
With out personal records
19
19
TOTAL
100
100
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
22
Number of respondents who kept official receipts of their payment. It is noted that
most (69%) of the respondents were always kept the official receipts given to them as
they paid serving as a document of their payment of their loans, 29 respondents said
sometimes and 2 respondents said they never kept their receipts (Table 12).
The results show that most of the respondents are aware of the importance of
keeping all the receipts of their payments. They have something to show as evidence if
problem on their payment arises.
Table 12. Response of the respondents as to how often they kept official receipts of their
payments
RESPONSE
FREQUENCY
PERCENTAGE (%)
Always
69
69
Sometimes
29
29
Never
2
2
TOTAL
100
100
Actions of the respondents if they could not pay their loans on time. Table 13
shows the actions that the respondents would do if they cannot be able to settle their loans
once it will due. Sixty-five mentioned that they would ask the cooperative to restructure
their loans, 22 said they would borrow from their immediate family members, co-makers
or neighbors, 15 respondents would ask the cooperative to offset their unpaid accounts
with their savings deposit, 10 said they will sell properties in order to pay their loans and
only 4 respondents said that they would resign from the cooperative.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
23
It is noted from the results that most of the respondents would try to exhaust all
possible remedies just to pay their loans if they would not be able to settle them on time.
Number of respondents who responded promptly to the reminder or notice letters
from the cooperative. Table 14 shows the number of respondents who promptly
responded to the reminder or notice letter of the cooperative.
Majority (51%) of the respondents said that only sometimes did they had respond
promptly to the reminder or notice letter from the cooperative. They reasoned out that
they had no time to go to the cooperative immediately as they received the notice or they
had no payment to bring to the cooperative. Whereas, few (49) of the respondents
responded promptly to the notice coming from the cooperative.
The result shows that all the respondents are at least responding to the notices
from the cooperative however, only a few gave immediate attention to the notices upon
receiving it.
Table 13. Actions of respondents if they could not settle their loans on time
RESPONSE
FREQUENCY
PERCENTAGE (%)
Sell properties
10
10
Ask the cooperative to restructure the
65
65
loan
Borrow from friends, family members,
22
22
neighbors
Offset with the savings deposit
15
15
Resign from the cooperative
4
4
TOTAL
116
116
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
24
Table 14. Response of respondents as to whether they respond promptly to the reminders
or notices coming from the cooperative
RESPONSE
FREQUENCY
PERCENTAGE (%)
Always
49
49
Sometimes
51
51
TOTAL
100
Respondents’ Perception on Borrowing
from the Cooperative
Perception of the respondents on the reasons for borrowing from the cooperative.
Table 15 shows the perception of the respondents why they borrowed or availed of loans
from the cooperative. Sixty-five of the respondents answered that borrowing from the
cooperative is a way of patronizing the cooperative’s service, 51% of the respondents
answered that the cooperative charged lesser interest rate and other fees as compared to
other lending institutions. Seven respondents said that the loan processing is short
meaning the borrower could get his/her loan from the cooperative in a shorter span of
time. Only very few respondents answered that the staff is friendly and they could avail
of higher loan from the cooperative. These drove them to borrow from the cooperative.
Perception of the respondents on the character of staff members assigned in the
loan section. Table 16 presents the perception of the respondents on the character of the
staffs assigned in loans section. Seventy percent of the respondents answered that the
staff were helpful and accommodating, 52% said that they were friendly and 17% said
that they were courteous at all times. Only one respondent said that the staff members
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
25
were not friendly and accommodating. The results show that most of the respondents
have positive remarks with regard to the character of the staff members who were
assigned in the loan section of the cooperative.
Table 15. Respondents’ perception on the reasons for borrowing from the cooperative
RESPONSE
FREQUENCY
PERCENTAGE (%)
It is a way of patronizing the service of
the cooperative
65
65
Lesser interest rate and other fees
51
51
Friendly staff
4
4
Loan processing is fast
7
7
Loan ceiling is higher
2
2
TOTAL
129
*Multiple response
Table 16. Respondents’ perception on the character of the staff members assigned to loan
section in the cooperative
RESPONSE
FREQUENCY
PERCENTAGE (%)
They are friendly
52
52
They are courteous at all times
17
17
They are helpful and accommodating
70
70
Not friendly and accommodating
1
1
TOTAL
140
*Multiple response
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
26
Perception of the respondents on the services of the staff members assigned to the
loan section. Ninety-six percent of the respondents were satisfied with the services
rendered by the staff members assigned to their loan section while only 6% of the
respondents were not satisfied (Table 17). The result shows that the staff members were
performed their respective tasks or functions properly as confirmed by the high approval
of the respondents about their service.
Table 17. Satisfaction of the respondents about the services of the staff members assigned
to the loan section
RESPONSE
FREQUENCY
PERCENTAGE (%)
Satisfied
94
94
Not satisfied
6
6
TOTAL
100
100
Perception of the respondents on the processing time for loans by the cooperative.
Eighty-seven respondents agreed that the processing time for loans by the cooperative
was just enough; eight respondents said that it was too long while five respondents said
that the processing time was too short (Table 18).
The results show that most of the respondents were contented with the time the
cooperative processed their loans from the filling of application until the releasing of
loans.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
27
Table 18. Perceptions of the respondents on the loan processing time by the cooperative
RESPONSE
FREQUENCY
PERCENTAGE (%)
Too long
8
8
Enough
87
87
Too Short
5
5
TOTAL
100
100
Perception of the respondents on the terms and conditions of the loans offered by
the cooperative. Table 19 shows the respondents’ perceptions on the terms and condition
of the loans offered by the cooperative. 86 or 86% of the respondents were satisfied with
the terms and conditions of the loans offered by their cooperative while only 11 or 11%
of the respondents were not satisfied. The result implies that most of the respondents
agreed with the terms and conditions of the loans which imposed by the cooperative.
Table 19. Satisfaction of the respondents on the terms and conditions of the loans offered
by the cooperative
RESPONSE
FREQUENCY
PERCENTAGE (%)
Satisfied
89
89
Not satisfied
11
11
TOTAL
100
100
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
28
Respondents’ Perception on Loan Repayment
Respondents’ perception on the reasons for paying their loans on time. Seventy-
one percent of the respondents claimed that paying loans on time is a responsibility that
should be done by any borrower. Forty-two of the respondents said to earn a good
reputation in the cooperative, 16 respondents said to be able to avail of higher loans, 24
respondents said for other members to have something to borrow and 10% of the
respondents, for the cooperative to be able to generate an income (Table 20).
Table 20. Respondents’ reasons for paying loans on time
RESPONSE
FREQUENCY
PERCENTAGE (%)
It is a responsibility of a borrower
71
71
To earn a good reputation in the
cooperative
42
42
To be able to avail of higher loan
16
16
So that members have something to
borrow
24
24
For the cooperative to generate an
income
10
10
TOTAL
163
163
*Multiple response
Perception of the respondents on whether loans from the cooperative should be
settled first before paying loans from other sources. Twenty-three respondents fully
agreed that payments should be made first for the loans in the cooperative before paying
loans to other sources. Sixty-eight agreed while only nine respondents disagreed (Table
21).
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
29
The results show that most of the respondents have positive perception that loans
from the cooperative should be given priority in terms of payment than the loans to other
sources. This confirms that the respondents have internalized the philosophy that
cooperative is owned, managed and controlled by the members thus, they prioritized their
payment to the cooperative before the others.
Table 21. Perception of the respondents as to whether loan payment should be prioritized
over loans to other sources
RESPONSE
FREQUENCY
PERCENTAGE (%)
Fully agree
23
23
Agree
68
68
Disagree
9
9
TOTAL
100
100
Perception of the respondents on the performance of the collectors of the
cooperative. Table 22 shows that most of the respondents had positive remarks on the
performance of the collectors of the cooperative. Twenty-seven respondents rated the
performance of the collectors as very good, 71 respondents’ rated good while only two
respondents gave poor rating to the collectors. The positive rating given by the
respondents to the collectors was due to the remarkable attitudes of the staff members
such as they were strict in implementing their collection policies, but they were courteous
in collecting, they had integrity and credibility, they maintained good rapport with the
borrowers and they maintained complete and accurate collection records.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
30
Table 22. Perception of the respondents on the performance of the collectors of the
cooperative
RESPONSE
FREQUENCY
PERCENTAGE (%)
Very good
27
27
Good
71
71
Poor
2
2
TOTAL
100
100
Respondents’ perception as to how accurate and complete record the recording
loan collection. Table 23 presents that 59 respondents said that the cooperative
maintained an accurate and complete record of the payments whereas 41 respondents said
sometimes.
The result reveals that majority of the respondents believe that the cooperative is
properly recording their payments and their records are properly kept at the office. On the
other hand, only few respondents said sometimes. According to them, they experienced
some instances wherein their loan balances in their own records do not jive with the
cooperative’s record. This happened when sometimes the staffs forgot to record
immediately their payments thus, they have to show receipts of their payment to correct
the discrepancy.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
31
Table 23. Perception of the respondents as to how accurate and complete their recording
of loan payments
RESPONSE
FREQUENCY
PERCENTAGE (%)
Always
59
59
Sometimes
41
41
TOTAL
100
100
Perception of the respondents on areas for improvement of the collectors. The
cooperative has three collectors. Table 24 shows the areas that the respondents perceived
should be improved among the collectors. Most (48%) respondents answered the staff
members should improve in the way they deal with the borrowers, 41 respondents said
they should do something in their strategies of collecting payment, 26 respondents said
about their character and 13 respondents answered about their recording of their
payments.
Problems Encountered by Member-Borrowers
That Affect Their Performance in Loan
Repayments
Table 25 presents the problems encountered by member-borrowers that affect
their performance in loan repayments.
Since majority of the respondents were farmers, most (54%) of their problem is
because of low prices of their produce. It is understood that when price of vegetables
goes down the farmers’ income is affected causing them not to be able to pay their loans
to the cooperative. Fourteen percent of the respondents said that they live very far from
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
32
the cooperative and there were no collectors going to their place. Since they live far, they
have hard time going to the cooperative to pay their loans especially when they are busy
in their farms. Another fourteen respondents said that the loan was not used wisely thus,
they could not generate income for the repayment.
Only few (5%) mentioned that the cooperative’s record does not conform with
their records and seven of the respondents mentioned that some of the officers and staff
members of the cooperative are not models to the member-borrowers since they
themselves had delinquent loans in the cooperative. Somehow, this influenced the
member-borrowers not to pay their loans also.
Lastly, ten respondents claimed that the term and conditions of their loans were
not properly explained to them.
Table 24. Perception of the respondents on the areas for improvements of the collectors
RESPONSE
FREQUENCY
PERCENTAGE (%)
Strategies in collection
41
41
Character
26
26
Dealing with the borrowers
48
48
Recording of payment
13
13
TOTAL
128
*Multiple response
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
33
Table 25. Problems encountered by the member-borrowers that affected their
performance in loan repayments
RESPONSE
FREQUENCY
PERCENTAGE (%)
Located far from the cooperative
14
14
Low prices of the produce
81
81
Cooperative’s record do not conform
with the member’s record
5
5
Some officers and staff set bad
examples
7
7
Lack on management skills on the
project
14
14
TOTAL
112
Respondents’ Recommendations for Improving
Their Attitudes and Perceptions on Loan
Borrowing and Repayment
Table 26 shows that 69% of the respondents recommended that the cooperative
must conduct regular information dissemination about loan policies, fifty five percent
said a continuous education for the member-borrowers on their duties and responsibilities
must be conducted regularly, fifty one percent of the respondents said that a regular
monitoring on the projects of the member-borrowers should be conducted to determine
whether they used the loans properly, forty seven percent of the respondents mentioned
that officers and staff members should always be good models in paying their loans on
time also, forty five percent of the respondents said that there must be rewards or
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
34
incentives given to the member-borrowers who pay their loans in advance or on time for
them to be encouraged. Moreover, thirty percent of the respondents said that staff
members should undergo further trainings on loan processing and collection.
Table 26. Recommendations of the respondents
RESPONSE
FREQUENCY
PERCENTAGE (%)
Conduct regular information
dissemination on the loan policies
69
69
The staffs should undergo trainings on
loan processing and collection
30
30
Regular monitoring on the projects of
the borrower
51
51
The officers and staffs should always
be good model by paying their loans
regularly
47
47
Conduct continuous education to the
55
55
member-borrowers on the duties and
responsibilities
There must be rewards or incentives to
the member-borrowers
45
45
*Multiple response
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
35
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
Summary
The study was conducted mainly to determine the practices and perceptions of the
member-borrowers of Bad-ayan Multipurpose Cooperative towards loan availment and
repayment. Bad-yan Multipurpose Cooperative is engaged in various operations; but
credit operation is their main source of income.
The respondents of this study were the member-borrowers of the cooperative. A
total of 100 respondents were randomly selected from the list of the cooperative. A
structured questionnaire was used to gather the data and information needed. The data
were then tabulated and analyzed statistically with the use of frequency and percentage.
It was found out that most of the member-borrowers availed of agricultural loans.
Majority had already availed of loans from the cooperative more than thrice.
Concerning the practices of the respondents on loans availment, most of the
respondents were able to prepare project proposals and most consulted their family
members when they borrowed from the cooperative. Before filling –up the loan
agreement, most respondents mentioned they personally read and understood all of its
details. They also explained what responsibilities of their co-makers are. Most of the
loans of the respondents were actually used to the purpose intended for.
According to the respondents, borrowing from the cooperative is a way of
patronizing its services being offered. As to the character of the staff members assigned
to the loan section, most respondents gave positive remarks stating that staff members are
helpful and accommodating. Generally, the respondents were satisfied with the services
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
36
rendered by the staff. The time consumed by the cooperative in processing the loan is
perceived by most of the respondents as just enough.
On loan repayment, most of the respondents followed their mode of payment. In
paying, most respondents asked official receipts and kept them. They have their own
record of their payments also. When they could not settle in due time, most respondents
preferred to ask the cooperative to restructure their loans. On the other hand, the
respondents responded to the reminders or notice letters coming from the cooperative
promptly. As to their payments, most respondents brought them to the cooperative.
Regarding the perceptions of the member-borrowers on loan repayment, most
respondents said that loans must be paid since it’s a main responsibility of the member-
borrower and a means of earning a good reputation in the cooperative. When asked
whether loans from the cooperative should be settled first before loans from other
sources, most respondents agreed it. The performance of the collectors was given a rating
of good by most respondents and they recommended that they should improve their
dealings with the borrowers. As to the records of loans maintained by the cooperative,
majority of the respondents answered always accurate and complete.
The problems encountered by the respondents affecting their loan repayment are
low prices of their produce; they live far from the cooperative that they have a hard time
going to the cooperative; lack of skills to manage their projects and the cooperative’s
records do not conform with their records.
Finally, the respondents were asked for their recommendations on how to
improve their attitudes on loan availment and repayment. Their recommendations are as
follows: the cooperative must conduct regular information dissemination for their loan
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
37
policies; continuous education of the member-borrowers on their duties and
responsibilities; a regular monitoring on the project of the member-borrowers, officers
and staff should always be good models by paying their loans on time also; there must be
rewards or incentives given to the member-borrowers who pay their loans in advance and
the staff should undergo trainings on loan processing and effective collection.
Conclusions
The following conclusions are derived based from the results of the study:
1. From the various types of loan being offered by the cooperative, agricultural
loan is mostly availed of by the member-borrowers.
2. Most respondents prepared project proposal, and consulted their family
members when borrowing, explained the responsibilities of their co-makers,
asked technical advice from the cooperative, borrowed loans only from the
cooperative, and used their loan for the intended purpose.
3. Most respondents believe that paying the loan is a main responsibility of a
borrower. Moreover, the respondents have positive remarks on the character
and services of the staff assigned to the loan section. Most respondents are
contented also with the loan processing time.
4. Most of the respondents followed their mode of payment, kept their receipts
and recorded their own payments and responded promptly to the notices from
the cooperative. As to their payments, most respondents brought them
cooperative. Majority of the respondents said the cooperative always
maintained an accurate and complete record.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
38
5. Low prices of products and the far distance to cooperative were identified by
the respondents as the main causes of their poor performance in loan
repayment.
6. The recommendations to improve attitude and perceptions on loan availment
and repayment are: conduct of regular information dissemination on loan
policies, continuous dissemination education to the member-borrowers about
their duties and responsibilities, a regular project monitoring, officers and staff
should be good models, rewards or incentives to be given to those who pay in
advance and staff should undergo trainings on loan processing to be more
efficient.
Recommendations
The following recommendations are:
1. The cooperative should conduct the following:
a) Continuous information dissemination of their loan policies for all the
members to be well informed. The dissemination could be done during
meetings or activities by distributing brochures containing the loan
policies to the members or posting them on the cooperative’s bulletin
board to be accessible to all the members;
b) Preparation of project plan that will enable the member-borrowers to
use their loans properly on a feasible project that would make them earn
enough for the repayments of their loans;
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
39
c) Seminars for the staff especially the collectors on strategies in
collecting, personality and values development and record keeping. These
seminars would somehow improve and develop the staff to become more
efficient and effective in discharging their functions.
d) Livelihood trainings so the member-borrowers will have alternative or
additional source of income especially if the price of their products goes
down. If they have other sources of income, they would have savings for
their loans.
2. Since the respondents have positive impressions on the character of the staff
and at the same time are satisfactorily contented with their services, the staff
members therefore recommended to maintain or further improve what they are
currently doing in the cooperative for them to be accepted by the member-
borrowers.
3. The members of the cooperative are scattered in the different barangays of
Buguias and one of the identified problem is the far distance of the members
from the cooperative that is situated at Baculungan Sur. With the large
number of borrowers, it is recommended that the cooperative would add to its
existing field offices that are located in Abatan and Bot-oan only. This would
facilitate the collection of the payments of the borrowers and at the same time
entice savings deposit among the people in the place.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
LITERATURE CITED
BLOCK, S.B. and HIRT, G.A., 1987. Foundation of Financial Management. Illinois,
USA: Irwin Homeland. Pp. 199
FAJARDO, F.R. and ABELLA. F. P. 1990. Cooperatives. Rex Printing Company Inc.:
Quezon City, Philippines. Pp 129.
MACARANAS, M.J. 1994. Manual Training Cooperative Management Staff.
International Labour Organization Cooperative. Entrepreneurs for Rural
Development: Quezon City, Philippines. Pp. 1, 18, 19
SACAY, O.J. 1985. Small Farmers Credit Dilemma. National Book Store Corporation:
Manila, Philippines. Pp. 2, 39, 41
TAGANAS, P. 1979. Repayment deficiencies of agricultural loan in Bontoc, Mt.
Province. BS Thesis. Benguet State University, La Trinidad, Benguet. Pp. 43
TAYLOR, D.O., 1970. Explanation of Purpose Behavior. Cambridge University: USA.
Pp. 78
WORLD BOOK ENCYCLOPEDIA. 2004.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
Appendix A
SURVEY QUESTIONNAIRE
I. General Information
Name (optional): _______________________________________
Address: ______________________________________________Age: ________
Sex: ________ Civil Status: ________
Address: ______________________________________________
Educational Attainment:
( ) Elementary
( ) Post College
( ) Secondary ( ) Vocational
( ) College ( ) Others (specify) _______________
Occupation: ___________________________
Type of loan you always avail in the cooperative? ___________________________
II. Attitudes and Perceptions on Borrowing
Please indicate your degree of agreement that comes closest to your feelings and
pertaining to your own action by checking the corresponding blank provided for.
Attitudes
1. Did you attend the Pre-Membership Education Seminar (PMES) conducted by the
Cooperative where the loan policies were explained?
______ yes ______ no
If no! Why? _________________________________________
2. Do you read and understand first the Loan agreements before filling –up and
submitting it to the cooperative for approval?
______ yes ______ no
3. Do you submit all the necessary requirements before filling your loan?
______ yes ______ no
4. Do you make plans where you will invest your loans before borrowing?
______ yes ______ no
If no! Why? ________________________________________
5. Do you make plans where you will source out your payments and how you will
pay your loans before borrowing? ______ yes ______ no
How? ____________________________________________________________
6. Did you strictly use your all loans in what you have stated in the loan agreements?
______ yes ______ no
If not all, where do you spend it?______________________________________
7. Did you explain first the responsibilities of your co-maker/s before getting them?
______ yes ______ no
8. Do you acquire loans in other lending institutions either private or public aside
from the cooperative?
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
______ yes ______ no
9. Do you consult first your family members or business partners before availing of
loans in the cooperative?
______ yes ______ no
10. Do you immediately use your loans upon getting it from the cooperative?
______ yes ______ no
If no, how many days/weeks /months that you handle before using it?
_______________________________________________________
11. Are you satisfied with the services of the staff assigned in the loans section in
your cooperative? ______ yes ______ no
12. Are you contented with the rates, mode/terms of payments of your loans?
______ yes ______ no
13. Are you contented with the time that your cooperative processes your loans?
______ yes ______ no
Perceptions
1. Membership in the cooperative is for the purpose of loaning only?
______ agree ______ uncertain ______ disagree
2. Borrowing from the cooperative is one way of patronizing it?
______ agree ______ uncertain ______ disagree
3. I borrow money for the sake of borrowing?
______ agree ______ uncertain ______ disagree
III. Attitudes and Perceptions on Paying Loans
Please indicate your degree of agreement that comes closest to your feelings and
pertaining to your own action by checking the corresponding blank provided for.
Attitudes
1. Do you pay your loans following the schemes you have agreed with the
cooperative?
______ yes ______ no
2. What makes or motivates you to pay your loans on time?
________ to be able to avail of a higher loan
________ to earn a good reputation in the cooperative
________ to help the cooperative lessen its delinquency
3. How do you pay your loans?
_________ go to the office personally
_________ wait for the collector
_________ give to any members who go to the cooperative
4. Do you wait for reminder or notice letters before settling your loans?
______ yes ______ no
5. What remedy/ies you undertake if you cannot pay your loans?
___________ resign in the cooperative and let the share capital be the payment
___________ sell properties
___________ go to the cooperative and ask for extension
___________ borrow outside
6. Are you satisfied when you pay your loans on time?
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
______ yes ______ no
7. If you cannot pay your loans, to whom do you usually ask for financial help?
_________ co-makers
_________ family members
_________ borrow from other lending institutions
Perceptions
1. There are always been a problem in the processing of loan in the cooperative
______ agree ______ uncertain ______ disagree
2. Satisfied with the rate, charges, and term of payment in the cooperative.
______ agree ______ uncertain ______ disagree
3. Pay early to help solve the cooperative financial situation and at the same time the
cooperative can lend to others.
______ agree ______ uncertain ______ disagree
4. Pay early to loan again.
______ agree ______ uncertain ______ disagree
5. Pay early so that I will be given a reward.
______ agree ______ uncertain ______ disagree
6. Pay early so that I will be a member in good standing of the cooperative.
______ agree ______ uncertain ______ disagree
IV. Problems Encountered by Members that Affect their Performance in Loan
Repayment.
Please check the problem you know that are encountered in the cooperative.
_______1. There are no field offices where the members located far from the
cooperative could pay.
_______2. There are no collectors who will regularly follow-up the payments of the
members.
_______3. Low income as a result of low prices of the products of the members.
_______4. The loan was used to other purposes.
_______5. Poor services of the staff.
_______6. Some officers are not model to the members in the sense that they are
also delinquent borrowers.
_______7. The Loan agreements are not properly explained and informed.
V. What would you recommend to the cooperative that would improve your attitudes and
perceptions on loan borrowing and repayment?
Please check the recommendation you like to be applied in the cooperative.
______Continuously conduct information dissemination especially on loan policies.
______The cooperative should be strict in implementing their loan policies to all
members.
______The staff should be trained on how to deal properly with the borrowers.
______The cooperative should have a regular monitoring scheme to the loans of the
borrowers.
______ The officers and staff should always maintain good relationship with the
borrowers.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
______ The officers should always be a role model by showing that they pay their loans
on time.
______The cooperative should give incentives that would encourage better performance
of the members.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
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42
Appendix A
Letter to the Respondents
Benguet State University
College of Agriculture
DEPARTMENT OF AGRIUCLTURAL ECONOMICS AND
AGRIBUSINESS MANAGEMENT
La Trinidad, Benguet
January 2007
Sir/Madam:
Greetings!!!
I am a fourth year student of Benguet State University taking up Bachelor of Science in
Agribusiness major in Cooperative Management. I am conducting my undergraduate thesis
titled, “Practices and Perceptions of Member-Borrowers of Bad-ayan Buguias Development
Multipurpose Cooperative Towards Loan Borrowing and Repayment”, as partial requirements
for graduation.
this connection, may I request a part of your time to answer the attached questionnaire.
Your kind assistance will enable me to complete all the requirements in due time. Rest assured
that all your answers will be kept confidential.
Thank you very much.
Truly yours,
FRANKLIN B. AGUSTIN
NOTED:
FLORENTINO B. LANDACAN
Adviser
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Appendix B
Survey Questionnaire
I. General Information on the Member-Borrower
Name (Optional) _________________________________________________________
Occupation: _____________________________________________________________
What types of loan (according to purpose) have you availed of from the Cooperative?
______ Agricultural Loans
______ Commercial Loans
______ Industrial Loans
______ Salary Loans
______ Emergency Loans
______ others, pls. specify____________________
How many times have you availed of loans from the Cooperative?
______Once only
______ thrice
______ twice
______ more than thrice
II. Practices on Borrowing
Did you make a project proposal on where your loans should be used before borrowing at the
cooperative?
Yes _____
No _____
If no, why?
________lack of knowledge to do
________it is not required by the coop
________others, pls specify: _________________________________________
Did you consult your family members or business partners on availing of loans at the
cooperative?
Yes _____
No _____
When the cooperative gave the loan agreements to you, what did you do?
_________ I personally read it and understood
_________ I just filled-out the information and submitted to the cooperative
_________I let somebody to fill-out the information
_________I never read it
_________others, pls specify________________________________________________
Did you accomplish and submit all the loans requirements in the cooperative before they released
your loan?
Yes _____
No _____
If no, what are those requirements you have not submitted? __________________
Did you ask for technical advice regarding your project from the cooperative staff?
Yes _____
No _____
If yes, what had you ask? ________________________________________________
Did you explain the responsibilities of your co-makers or guarantors when you called them?
Yes _____
No _____
Did you use your loan for the purpose/s you stated in the loan agreement?
Yes _____
No _____
If no, why? _______________________________________________________
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Do you have loans from other cooperatives or lending institutions?
Yes _____
No _____
If yes, what are your reasons for availing of loans from other cooperatives/lending
institutions? _________________________________________________________
Upon releasing your loans, did you use it immediately in your project?
Yes _____
No _____
If no, why? ____________________________________________________
Do you make savings deposits and add your share capital in the cooperative as a security of your
loans?
_________always
____________sometimes
_________ never
III. Practices on Loan Repayment
Do you pay your loans following the mode of payment you have agreed with the cooperative?
_________always
____________sometimes
_________ never
How do you pay your loans?
_______ go to the cooperative personally
_______ through the collector
_______ give it to any member who goes to the cooperative
_______others, pls specify _______________________________________________
Do you ask for and keep your official receipts and other documents showing your payment of
your loan?
_________always
____________sometimes
_________ never
Are you maintaining a complete record of your payments?
_________yes
____________no
What actions would you undertake if you could not be able to pay your loans on time in the
cooperative?
______sell properties
______ask the cooperative to restructure the loan
______borrow from friends, neighbor or other cooperatives
______ask the cooperative to offset with the savings or share capital
______resign in the cooperative
_____others, pls specify: ____________________________________________
Do you give attention and respond promptly to the reminder or notice of your cooperative
regarding your payments?
_________always
____________sometimes
_________ never
Have you been exhausting all possible remedies just to be able to pay your loans in the
cooperative on time?
_________always
____________sometimes
_________ never
IV. Perceptions on Borrowing
Why did you borrow from your cooperative?
__________it is a way of patronizing the service of the cooperative
__________lesser interest rates and other fees
__________the staffs are friendly
__________the time of the processing the loan is short
__________the loan ceiling is higher
__________others, pls specify
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
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How do you describe the staffs who are assigned in the loan’s section of your cooperative?
a. _______ they are friendly
____not friendly
b. _______ they are courteous at all times
____not courteous
c. _______they are helpful and accommodating _____not helpful and accommodating
d. _______others, pls specify _______________________________
How do you rate the service of the staff ?
Yes _____
No _____
If no, why? ______________________________________________________
Do you agree/disagree with the following terms and conditions of the loans offered by your
cooperative?
Yes _____
No _____
What can you say about the time consumed by your cooperative in processing your loans?
_________ too long
_________ enough
_________ short
V. Perception on Loan Repayment
Why do you pay your loans on time?
______to be able to avail of a higher loan
______to earn a good record or reputation in the cooperative
______it is a responsibility of a borrower
______for the cooperative to generate an income
______so that other members have something to borrow
______to get a reward or incentive from the cooperative
______others, pls specify_______________________________________________
Do you believe that loans from the cooperative should be paid first before paying the loans from
other sources?
________fully agree
________agree
_______disagree
How do you describe your collector or person in-charge in the collection in your cooperative?
___ strict in implementing the policy in the collection ____ not strict in the collection
___ courteous in collecting
____ not courteous
___maintains integrity and credibility
____has no integrity and credibility
____maintains good rapport with the borrowers
____always maintains complete and accurate collection record
____others, pls specify: ______________________________________________________
Generally, how would you rate the collectors of your loans?
______ very good
_________good
________poor
What are the areas you recommend for the improvement of the staff in-charge in the loan
collection?
______strategies in collection
______character
______relationship with the borrowers
______recording of payments
______others, pls specify
Does your cooperative maintains an accurate and complete record of all your payments?
_________always
____________sometimes
_________ never
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VI. Problems Encountered by Member-Borrowers that Affect their Performance in Loan
Repayment
______there are no collectors who will regularly collect the payments
______there are no field offices where the borrowers could pay especially those who are located
very far from the coop office
______the cooperative’s record does not conform to the member’s record
______the term and conditions of the loans are not properly explained to the borrower
______low income because of low prices of the products of the members
______Some officers and staff set bad examples to the member-borrowers for they are
delinquents
______very poor services of the staff
______the loan was not used properly
VII. What would you recommend to the cooperative that would improve your attitudes and
perceptions on loan borrowing and repayment?
______conduct regular information dissemination on loan policies of the cooperative
______strict implementation of loan policies to all member-borrowers
______the staff in-charge in loans should undergo trainings on loan processing and collection
______regular monitoring of the loans of the member-borrowers
______officers and staff should always be good model by paying their loans regularly
______conduct continuous education to the member-borrowers on their duties and
responsibilities
______there must be rewards or incentives given to the member-borrowers who have good credit
record
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
AGUSTIN, FRANKLIN B. APRIL 2007. Practices and Perceptions of Member-
borrowers of Bad-ayan Buguias Development Multipurpose Cooperative Towards Loan
Borrowing and Repayment. Benguet State University, La Trinidad, Benguet.
Adviser: Florentino B. Landacan Jr.
ABSTRACT
The study was conducted mainly to determine the practices and perceptions of the
member-borrowers of BABUDEMPCO towards loan borrowing and repayment. The
study was conducted from January to February 2007.
The total numbers of respondents in the study were one hundred member-
borrowers of BABUDEMPCO.
It was found out that most of the respondents are farmers, thus, an agricultural
loan is the most type of loan availed loan by the member-borrowers.
As to the practices of member-borrowers towards loan borrowing, most of the
respondents were able to prepare project proposals, consulted their family members when
they borrowed from the cooperative, personally read and understood all the details in the
loans agreement, explained what responsibilities of their co-makers are. Most of the loans
of the respondents were actually used to the purpose intended for. On loan repayment,
most respondents preferred to ask the cooperative to restructure their loans if they could
not settle their loan on time. Most respondents responded to the reminders or notice
letters coming from the cooperative promptly. As to their payments, most respondents
brought them personally to the cooperative.
On the other hand, as to the perceptions of member-borrowers towards loan
borrowing and repayment, the respondents mentioned that borrowing from the
cooperative is a way of patronizing its services being offered. They also give positive
remarks to the staff. The respondents were satisfied with the services rendered by the
staff. The time consumed by the cooperative in processing the loan is perceived by most
of the respondents as just enough.
The problems mostly encountered by the respondents affecting their loan
repayment are low prices of their produce and they live far from the cooperative that they
have a hard time going to the cooperative.
The respondents recommend that the cooperative must conduct regular
information dissemination for their loan policies, continuous education of the member-
borrowers on their duties and responsibilities; a regular monitoring on the project of the
member-borrowers, officers and staff should always be good models by paying their
loans on time also, their must be rewards or incentives given to member-borrowers who
pay their loans in advance and the staff should undergo trainings on loan processing and
effective collection.
i i
TABLE OF CONTENTS
Page
Bibliography ………………………………………………………………….
i
Abstract …………………………………………………………………………..
i
Table of Contents …………………………………………………………
iii
INTRODUCTION
Rationale ……………….…………………………………………………
1
Statement of the Problem ……………………………………………..
3
Objectives of the Study ……………………………………….............
3
Importance of the Study ………………………………………………
4
Scope and Limitation of the Study …. …………………………………
4
REVIEW OF LITERATURE
Loan Practices of Borrowers that
Led to Loan Delinquency………………………………………………….
5
Practices that can Contribute to
Cooperatives Success……………………………………………………...
5
Perceptions………………………………………………………………..
6
Loans……………………………………………………………………….
6
Inability to Repay………………………………………………………….
7
Problems in the Collection of Loans………………………………………
7
Definition of Terms……………………………………………………….
8
METHODOLOGY
Locale and Time of the Study ……………………………………….
9
Respondents of the Study ………………………………………………
9
iii
Data Collection ………………………………………………...............
9
Data Gathered …………………………………………………………….
9
Data Analysis ………………………………………………………….
11
RESULTS AND DISCUSSION
Brief Information on the Cooperatives ………………………...............
11
Practices of the Member-Borrowers in
Borrowing Loan in the Cooperative……………………….........................
13
Practices of the Member-Borrowers in
Repaying Loan in the Cooperative……………………….........................
20
Respondents’ Perception on
Borrowing From the Cooperative ………………………………………..
24
Respondents’ Perception on Loan Repayment .........................................
28
Problems Encountered by Member-Borrowers that
Affect Their Performance in Loan Repayments………………………….
31
Respondents’ Recommendations for Improving
Their Attitudes and Perceptions on Loan
Borrowing and Repayment………………………………………………..
33
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
Summary …………………………………………………….................
35
Conclusions …………………………………………………................
37
Recommendations ……………………………………………………..
38
LITERATURE CITED …………………………………………………….
40
APPENDICES
Appendix A. Letter to the Respondents………………………………….
41
Appendix B. Survey Questionnaire………………………………………
42
iv
1
INTRODUCTION
Rationale
A cooperative is primarily organized to provide the necessary common needs of
its members that improve and uplift their living condition within the context of the
universally accepted cooperative principles of membership, democratic administration,
equitable contribution, savings disposal, education and inert cooperative cooperation
(Mendoza, 1980). It is also a way of easing financial inadequacy of its members through
loans with minimal rates for provident and productive purposes.
Most farmers who need funds for their production organize cooperatives. In 1967,
there was a group of 35 people in Buguias, Benguet who pooled their resources to
establish a Credit Union. It was named as Bad-ayan Credit Union. On July 10, 1968, it
was registered with the Cooperative Administration Office (CAO) with a Certificate of
Registration No. 001964 under the Republic Act No. 2023. However, the association
became dormant for a period of five years.
On October 1971, the association was re-organized wherein a series of
membership seminars was conducted to refresh the old members regarding the
importance of credit union. On May 10, 1976, the credit union was registered as a
precooperative under the Bureau of Cooperative and Development thereby mandated to
elect its set of Board of Directors and committee members. It adopted the name Bad-ayan
Credit Cooperative Union, Inc. The cooperative operated fruitfully thus, they were able to
acquire land and built an office for the Cooperative Union in 1982.
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On May 22, 1989, the Bad-ayan Credit Union Inc. was renamed as Bad-ayan
Buguias Development Cooperative, Inc. with Registration No. CAR ff-009 under the
Office of Bureau of Agricultural Cooperative Development. Finally, on October 18,
1994, the cooperative amended its name to Bad-ayan Buguias Development Cooperative
(BABUDEMPCO) that becomes its name until the present. The said amendment was
done in response to the memorandum from the CDA calling cooperatives registered
under the RA 6938 to drop the word incorporated.
Just like other cooperatives, BABUDEMPCO has experienced difficulties in its
operation that nearly lead to its bankruptcy. Like in 1990 during the killer Earthquake,
their members’ products were destroyed that resulted to the decline of their income. With
this, the members were not able to repay their loans to the cooperative and there were no
deposits generated from the members. Nevertheless, because of the financial assistance
from some local and international institutions, the cooperative was able to stand with its
feet again and it continued to grow until now.
At present, the cooperative has a total membership of 3, 997 composed of 1,628
regular members and 2,369 associate members. It operates in the whole municipality of
Buguias, Benguet. Credit is one of its services and like many credit cooperatives
organized in the country, BADUDEMPCO has been experiencing problems on its
lending operation. In fact, it was not able to establish a satisfactory track record in its
lending operation. As of July 2006, about 1,029 member-borrowers availed of loans from
the cooperative.
The member-borrowers have a vital role in making the credit operation of the
cooperative a success. If members used their loans in a proper way, then they could be
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
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able to pay their loans on time to the cooperative. This only means that one of the main
factors to look on is the member-borrower’s practices and perceptions regarding
borrowing and repayment of his loans. This is what the study intended to determine.
Statement of the Problem
Specifically, the study was conducted to find the answers to the following
questions:
1. What are the types of loan being offered by the cooperative that are mostly
availed of by the member-borrowers?
2. What are the practices of member-borrowers towards loan borrowing and
repayment?
3. What are the perceptions of member – borrowers towards loan borrowing and
repayment?
4. What are the problems encountered by the member-borrowers that affect their
performance in loan repayment?
5. What are the solutions to the problems identified?
Objectives of the Study
The objectives of the study are as follows:
1. To determine the types of loans being offered by the cooperative that are
mostly availed of by the member-borrowers;
2. To determine the practices of member-borrowers towards loan borrowing and
repayment;
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3. To determine the perceptions of member-borrowers towards loan borrowing
and repayment;
4. To find out the problems of the member-borrowers that affect their
performance in paying their loans to the cooperative; and
5. To recommend possible solutions to the problems identified.
Importance of the Study
The results of this study could be used by the cooperative as a basis in
formulating and strengthening the implementation of its loan polices.
Moreover, the results of the study could be used as a guide for the cooperative in
planning and conducting the necessary activities or programs that would improve the
attitudes and perceptions of the member-borrowers towards borrowing and repaying their
loans which could generally improve their performance in the cooperative.
Students or any researcher planning to conduct related studies could use the
results of this study.
Scope and Limitation of the Study
This study mainly concentrates on determining the practices and perceptions of
the member-borrowers of Bad-ayan Buguias Development Multipurpose Cooperative
towards borrowing and repayment of their loans and the problems affecting the member-
borrowers’ performance in paying their loans. The study was conducted from January to
February 2007.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
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REVIEW OF LITERATURE
Loan Practices of Borrowers that
Led to Loan Delinquency
Taganas (1979) found out that the failure of farmers to pay loans on time at
maturity was caused by diversion of loan to non-farm activities. This was due to late
release of the loan which motivated them to divert it to purpose other than the intended
purpose. As a result, nothing was used on the intended purpose. This further resulted to
the extent of selling their house, lands just to augment the amount needed for land
preparation and other expenditures. Others sold their houses to pay their debts when the
collateral used was forfeited.
Practices that can Contribute to
Cooperative Success
Fajardo and Abella (1990) mentioned several factors that have been contributing
to the success of cooperatives in the past. The following factors were as abed on a survey
of successful cooperatives in the country: 1) continuous training and education of the
officers, members and employees, 2) Appropriate and adequate organizational structures
to cope with the varying and increasing needs and problems of the cooperative members
and the community, 3) Progressive and people-oriented on loan savings, education,
management and community development, 4) Presence of effective, honest and dedicated
cooperative and community leaders, 5) Active involvement and participation of officers
and members in the affairs of their cooperatives and the community, 6) Trust and
confidence in cooperative officers, 7) Dependence on self-help process in achieving their
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programs and projects, 8) Wise election of cooperative officers, 9) Spirit of cooperation
and camaraderie prevails among the officers, members and employees of the cooperative,
10) Efficient service for the promotion of social and economic advancement of
cooperative members, good public relation and 11) availability of competent and honest
managers.
Perceptions
In psychology and the cognitive science, perception is the process of acquiring,
interpreting, selecting, and organizing sensory information.
Taylor (1970) found out that one’s perception is of a certain thing that determines
the overt behavior exhibited under a given condition. Perception is the process of
becoming aware of objects, qualities, relation or problems by way of the sense organ
which is closely related to actions. He concluded also that an individual’s perception
affects his behavior and how he perceives a situation.
Loans
For many years, cooperative has been always there to help. It’s just absolutely
impossible to think how men survived through ages if they did not help one another.
History books now tell us that cooperativism has been a practice since before. But
today’s modern world, there was a great improvement in cooperative operation. One
great improvement is loan assistance to members.
Simple definition of loan is the act of lending and/or lending with an interest. A
member loans out money for many purposes such as production purposes, for buying
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
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facilities and equipment needed in the farm, or family expenses during the period
between planting and harvesting of crops for farm improvement and for other purposes
(World Book Encyclopedia, 2004).
Inability to Repay
According to Sacay (1985), sheer poverty seemed to be the primary root cause of
delinquency. The common rural folks had become heavily indebted because they needed
credit to cover up their chronic cash deficit and sustain their subsistence level of
expenditures.
Block and Hirt (1987) also stated that people with low level of formal education
would inherently be a poor credit risk. The TBAK observation shows the importance of
providing for a sustained education campaign to ensure that member-borrowers are
sufficiently informed on the ways and practices of the cooperative especially with respect
to credit and obligation to pay back their loan.
Problems in the Collection of Loans
Delinquent loans in cooperatives are due to circumstances which if not properly
managed will result to tremendous financial set back and loss of confidence of member-
borrowers in the cooperative’s lending services.
Macaranas (1994) stated that loan delinquency has always been a big problem
among cooperatives and the failure to recognize this problem and institute the necessary
remedy led to the demoralization of both members and officers and ultimately to the
failure of the cooperative.
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Definition of Terms
Perceptions. The process of becoming aware of objects, qualities, relations or
problems by way of the sense organ that is closely related to actions.
Credit. It refers to the engine of socio-economic upliftment of big and small
entrepreneurs of the rural poor.
Loan. An amount of money given to somebody on the condition that it will be
paid back later.
Capacity. Refers to borrower’s ability to pay back the sum borrowed based on his
or her earning capacity.
Loan repayment. It is an extinguishing liabilities.
Delinquent. It refers to a member-borrower’s loan accounts have experienced
difficulties whose full collection of principal and interest are doubtful.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
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METHODOLOGY
Locale and Time of the Study
The study was conducted at Bad-ayan Buguias Development Multi-Purpose
Cooperative located at Buguias, Benguet, which is widely known as one of the major
producers of high yielding vegetable varieties in the province. Figure 1 shows the locale
of the study. The study was conducted from January to February, 2007.
Respondents of the Study
The respondents of the study were the member-borrowers of Bad-ayan Buguias
Development Multi-purpose Cooperative with loans that are classified as current
accounts. One hundred respondents were randomly chosen from the list of borrowers
provided by the cooperative.
Data Collection
A survey questionnaire was used as the instrument in gathering the information
and data needed in the study. An interview was also done with the manager of the
cooperative and some of the respondents for additional information.
Data Gathered
The data gathered were the practices and perceptions of the member-borrowers of
Bad-ayan Buguias Development Multipurpose Cooperative towards loan borrowing and
repayment.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
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Data Analysis
The data was tabulated, analyzed and interpreted according to the objectives of
this study using the descriptive statistics like frequency and percentage methods.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
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RESULTS AND DISCUSSION
Brief Information on the Respondents
Table 1 presents the occupation, number of loan and total loans availed of by the
respondents from the cooperative.
Occupation. Sixty-two of the respondents are farmers, 12 respondents are working
in government offices, seven are employees of the cooperative, and 10 respondents are
laborers. A Few of the respondents are businesspersons and housekeepers. The results
show that most of the respondents are involved in farming.
Types of loan mostly availed of by the respondents. The cooperative offers the
following types of loan: agricultural loan, emergency loan, educational loan, salary loan,
commercial loan and industrial loan. As shown in Table 1, 84% of the respondents
availed of the agricultural loan while a few (27%) of the respondents availed of the
emergency loan. Only very few of the respondents availed of the other types of loans.
The results show that agricultural loan is usually availed of by most of the
respondents for the reason that most of the respondents are farmers. Agricultural loan is
for procurement of farm inputs, improvement of farms, marketing of farm products and
others.
Number of times the respondents have availed of loans. Fifty percent of the
respondents had already availed of loans more than thrice from the cooperative; 26%,
twice; 17 respondents, first time to borrow from the cooperative and seven respondents,
third time to borrow from the cooperative.
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The result implies that most of the respondents established a long credit
relationship with the cooperative. This also means that most of the respondents
performed well in their payments thus the cooperative was able to give them another loan
after satisfying their previous loan.
Table 1. Occupation, types of loans mostly availed of by the member-borrowers and
number of times the member-borrowers availed of loans in the cooperative
PARTICULAR
FREQUENCY
PERCENTAGE (%)
Occupation
Farmers
62
62
Cooperative Employees
7
7
Government Employees
12
12
Businessmen
3
3
Laborers
10
2
Housekeepers
6
6
TOTAL
100
100
Types of loans availed of by the member-
borrowers
Agricultural Loan
84
84
Emergency Loan
27
27
Educational Loan
7
7
Salary Loan
6
6
Commercial Loan
4
4
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
13
Table 1… continuation
PARTICULAR
FREQUENCY
PERCENTAGE (%)
Industrial Loan
3
3
TOTAL
131
Number of times the respondents have
availed of loans in the cooperative
Once
17
17
Twice
26
26
Thrice
7
7
More than thrice
50
50
TOTAL
100
100
Practices of the Member-Borrowers in
Borrowing Loans in the Cooperative
Number of respondents who prepare project proposal. Project proposal is
prepared to determine the various activities to be done in carrying out the project and
generally, to determine the feasibility of the project to be undertaken.
Table 2 presents that most (77%) of the respondents prepared project proposal
before borrowing from the cooperative. The remaining 23% of the respondents did not
prepare project proposal because of lack of knowledge to do it. According to them, the
project proposal was not also a compulsory requirement for availing of loans from the
cooperative. The result shows that a great majority of the respondents planned carefully
where they would invest their loans. Therefore, when their loan is released they know
already where to spend and how to spend it.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
14
Table 2. Response of the respondents as to whether they prepare project proposal
RESPONSE
FREQUENCY
PERCENTAGE (%)
Prepared project proposal
77
77
Did not prepare project proposal
23
23
TOTAL
100
100
Number of respondents consulting their family members when borrowing. Table
3 shows that 91% of the respondents have consulted their family members before they
borrowed from the cooperative while 9% of the respondents did not consult their family
members.
This means that majority of the family members have a knowledge or idea about
the loan availed of by the respondents. The family members could be the spouse, children
or parents of the member-borrowers. A great percentage of those who consulted their
family members is attained since the cooperative has required the member-borrowers to
let their spouses sign the loan papers especially when conjugal properties are offered as
collateral to the cooperative.
Number of respondents who read and understood the loans agreement. Table 4
presents the number of respondents who read and understood the loans agreement before
signing it. Loan agreement refers to the promissory note and other released papers that
the borrower has to read and sign before the cooperative could release the loan.
Most (61%) of the respondents said that they personally read and understood
every detail written in the loan agreement. Thirty (30%) of the respondents said that they
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
15
just filled-in the information required in the loan agreement and submitted it to the
cooperative. Whereas, 9% of the respondents cannot read so they let someone to fill-up
the information without explaining the contents to them.
The result shows that most of the member-borrowers cared to read and understand
the contents of the loan agreement before filling-up the required information and finally
submitting it to the cooperative. With this, they were aware of the terms and conditions of
their loans such as their due date, amortization, and the penalty or surcharge for not
paying on time and others related to their loans.
Number of respondents who explained the responsibilities of their co-makers. The
borrowers are required to have co-makers to sign the loan agreement and even to appear
at the cooperative during the release of the borrower’s loan. The co-makers are
understood to have responsibilities in the loans of the borrower, as they could be the ones
to pay when the borrower will not be able to pay the loan.
Table 5 shows the number of the respondents who explained what the
responsibilities of their co-makers are. Eighty (87%) of the respondents said that they
explained what are the responsibilities of being their co-makers or guarantors whereas
only 13 or 13% of the respondents said that they did not explain the responsibilities of
their co-makers since they assumed that they already know it.
The result shows that most of the respondents informed their own co-makers of
their responsibilities.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
16
Table 3. Response of the respondents as to whether they consult their family members
when borrowing
RESPONSE
FREQUENCY
PERCENTAGE (%)
Consulted family members
91
91
Did not consult family members
9
9
TOTAL
100
100
Table 4. Response of the respondents as to whether they read and understood the loan
agreement
RESPONSE
FREQUENCY
PERCENTAGE (%)
Personally read and understood it
61
61
Just fill-in the information required and
30
30
submit in the cooperative
Did not read it
9
9
TOTAL
100
100
Table 5. Response of the respondents who explained the responsibilities of their co-
makers
RESPONSE
FREQUENCY
PERCENTAGE (%)
Explained
87
87
Did not explain
13
13
TOTAL
100
100
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
17
Number of respondents who actually used their loans for the intended purpose.
One information contained in the loan application is the purpose of the borrower for
loaning. The purpose written by the borrower in the application form must be carried out
once the loan is approved and released.
Table 6 shows the number of respondents who really used their loans for what
they have stated in their loan application. Almost all (97%) of the respondents said
that they actually used their loan in the purpose they have stated in their loan application
whereas only 3 or 3% of the respondents said that they diverted it to other purposes
others than what they have originally stated in their loan application.
Moreover, most of the respondents used their loans for procurement of farm
inputs since most of them are farmers and some used it for educational purposes like for
paying the tuition fees of their children and other school needs. Few respondents used
their loans for buying medicines or seed capital for business and others.
The result shows that the respondents knew how to follow or implement honestly
the purpose they have stated in their application form.
Table 6. Response of the respondents as to whether they used their loans for the intended
purpose
RESPONSE
FREQUENCY
PERCENTAGE (%)
Used for the intended purpose
97
97
Did not use for the intended purpose
3
3
TOTAL
100
100
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
18
Number of respondents who used immediately their loans for their project. The
loan, upon release from the cooperative should be used in the project immediately. This
practice of putting immediately using the project to the project would spare the borrowers
from spending their loans for other purpose or being subjected to misspending or even
losing the money. With this, Table 7 shows the number of respondents who utilized
immediately their loans for their planned project.
It is noted that almost all (96%) of the respondents revealed that as soon as their
loan was released, they used it immediately for their project while very few or (4%) said
they waited for weeks before finally using their loan.
This shows that most of the respondents planned already where to put their loans.
This confirms that most of the respondents prepare project proposal on where and how to
spend their loan.
Table 7. Response of the respondents as to whether they used their loans immediately for
their project
RESPONSE
FREQUENCY
PERCENTAGE (%)
Immediately Used
96
96
Not Used Immediately
4
4
TOTAL
100
100
Number of respondents who borrowed only from the cooperative. Table 8 shows
the number of respondents who availed of loans only from the cooperative. Sixty-six
percent of the respondents said that they only availed of loans from the cooperative.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
19
Whereas, thirty-four percent of the respondents loaned-out from other lending institutions
aside from the cooperative. They reasoned out that they were forced to borrow from other
sources since they were given a small amount by the cooperative which is not enough to
finance their projects.
The result reveals that most of the respondents made the cooperative as their only
source of loans thus; there is greater probability that they could be able to pay their loans.
Table 8. Response of the respondents as to whether the cooperative is the only source of
their loan
RESPONSE
FREQUENCY
PERCENTAGE (%)
Borrowed exclusively from Coop
66
66
Borrowed from other Sources
34
34
TOTAL
100
100
Number of respondents who have savings deposits in the cooperative. Table 9
shows the number of respondents who have made savings deposit in the cooperative that
they could use it as payments for their loans.
Out of the 100 respondents, 94 said that they deposited their savings in the
cooperative. Some of them even deposited their daily collections from their business and
withdrew it upon their payment time. Some respondents said that they were not able to
have savings deposit on a regular basis but once they had extra money, it surely went to
the cooperative. Only four respondents answered that they never had savings deposit in
the cooperative. The results show that most of the respondents knew how to save in the
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
20
cooperative, which they could use it as payments for their loans. On the other hand, the
cooperative is at least comfortable since there are savings of its member-borrowers that
could be frozen and withdrawn if they could not be able to pay their loan.
Table 9. Response of the respondents as to whether they are having savings deposit in the
cooperative
RESPONSE
FREQUENCY
PERCENTAGE (%)
With savings deposit in the coop
94
94
Without savings deposit in the coop
6
6
TOTAL
100
100
Practices of the Member-Borrowers in
Repaying Loans in the Cooperative
Number of respondents who followed their mode of payment as stated in the loan
agreement. Table 10 shows the number of respondents who followed the mode of their
payment. Sixty-two of the respondents said sometimes, 37 respondents answered always
and only one respondent said never.
The result tells that most of the respondents do not pay regularly when they have
to pay and only few of them followed their schedule of payment, like monthly or weekly.
Number of respondents who maintained a record of their payments. Table 11
shows the number of respondents who had their own record of their payments.
It is noted that majority (81%) of the respondents kept records of their payments.
According to them, they recorded every payment they made to the cooperative in their
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
21
notebooks and they compare their loan balances as reflected in their notebook to the
record on the cooperative. With this, they could easily track down if there are
discrepancies. Whereas, only few (19%) of the respondents did not have records of their
own payments, they trusted that their payments were properly accounted for so they just
relied on the records of the cooperative and the official receipts they were keeping.
The results show that the most of the respondents are very concern on their
payments thus, they have records of their own payments. This is a way also of identifying
if errors are incurred by comparing the balances from the borrower’s record with that of
cooperative’s record.
Table 10. Response of the respondents as to whether they follow their mode of payment
RESPONSE
FREQUENCY
PERCENTAGE (%)
Always
37
37
Sometimes
62
62
Never
1
1
TOTAL
100
100
Table 11. Response of the respondents as to the way they recorded their own payments
RESPONSE
FREQUENCY
PERCENTAGE (%)
With personal records
81
81
With out personal records
19
19
TOTAL
100
100
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
22
Number of respondents who kept official receipts of their payment. It is noted that
most (69%) of the respondents were always kept the official receipts given to them as
they paid serving as a document of their payment of their loans, 29 respondents said
sometimes and 2 respondents said they never kept their receipts (Table 12).
The results show that most of the respondents are aware of the importance of
keeping all the receipts of their payments. They have something to show as evidence if
problem on their payment arises.
Table 12. Response of the respondents as to how often they kept official receipts of their
payments
RESPONSE
FREQUENCY
PERCENTAGE (%)
Always
69
69
Sometimes
29
29
Never
2
2
TOTAL
100
100
Actions of the respondents if they could not pay their loans on time. Table 13
shows the actions that the respondents would do if they cannot be able to settle their loans
once it will due. Sixty-five mentioned that they would ask the cooperative to restructure
their loans, 22 said they would borrow from their immediate family members, co-makers
or neighbors, 15 respondents would ask the cooperative to offset their unpaid accounts
with their savings deposit, 10 said they will sell properties in order to pay their loans and
only 4 respondents said that they would resign from the cooperative.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
23
It is noted from the results that most of the respondents would try to exhaust all
possible remedies just to pay their loans if they would not be able to settle them on time.
Number of respondents who responded promptly to the reminder or notice letters
from the cooperative. Table 14 shows the number of respondents who promptly
responded to the reminder or notice letter of the cooperative.
Majority (51%) of the respondents said that only sometimes did they had respond
promptly to the reminder or notice letter from the cooperative. They reasoned out that
they had no time to go to the cooperative immediately as they received the notice or they
had no payment to bring to the cooperative. Whereas, few (49) of the respondents
responded promptly to the notice coming from the cooperative.
The result shows that all the respondents are at least responding to the notices
from the cooperative however, only a few gave immediate attention to the notices upon
receiving it.
Table 13. Actions of respondents if they could not settle their loans on time
RESPONSE
FREQUENCY
PERCENTAGE (%)
Sell properties
10
10
Ask the cooperative to restructure the
65
65
loan
Borrow from friends, family members,
22
22
neighbors
Offset with the savings deposit
15
15
Resign from the cooperative
4
4
TOTAL
116
116
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
24
Table 14. Response of respondents as to whether they respond promptly to the reminders
or notices coming from the cooperative
RESPONSE
FREQUENCY
PERCENTAGE (%)
Always
49
49
Sometimes
51
51
TOTAL
100
Respondents’ Perception on Borrowing
from the Cooperative
Perception of the respondents on the reasons for borrowing from the cooperative.
Table 15 shows the perception of the respondents why they borrowed or availed of loans
from the cooperative. Sixty-five of the respondents answered that borrowing from the
cooperative is a way of patronizing the cooperative’s service, 51% of the respondents
answered that the cooperative charged lesser interest rate and other fees as compared to
other lending institutions. Seven respondents said that the loan processing is short
meaning the borrower could get his/her loan from the cooperative in a shorter span of
time. Only very few respondents answered that the staff is friendly and they could avail
of higher loan from the cooperative. These drove them to borrow from the cooperative.
Perception of the respondents on the character of staff members assigned in the
loan section. Table 16 presents the perception of the respondents on the character of the
staffs assigned in loans section. Seventy percent of the respondents answered that the
staff were helpful and accommodating, 52% said that they were friendly and 17% said
that they were courteous at all times. Only one respondent said that the staff members
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
25
were not friendly and accommodating. The results show that most of the respondents
have positive remarks with regard to the character of the staff members who were
assigned in the loan section of the cooperative.
Table 15. Respondents’ perception on the reasons for borrowing from the cooperative
RESPONSE
FREQUENCY
PERCENTAGE (%)
It is a way of patronizing the service of
the cooperative
65
65
Lesser interest rate and other fees
51
51
Friendly staff
4
4
Loan processing is fast
7
7
Loan ceiling is higher
2
2
TOTAL
129
*Multiple response
Table 16. Respondents’ perception on the character of the staff members assigned to loan
section in the cooperative
RESPONSE
FREQUENCY
PERCENTAGE (%)
They are friendly
52
52
They are courteous at all times
17
17
They are helpful and accommodating
70
70
Not friendly and accommodating
1
1
TOTAL
140
*Multiple response
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
26
Perception of the respondents on the services of the staff members assigned to the
loan section. Ninety-six percent of the respondents were satisfied with the services
rendered by the staff members assigned to their loan section while only 6% of the
respondents were not satisfied (Table 17). The result shows that the staff members were
performed their respective tasks or functions properly as confirmed by the high approval
of the respondents about their service.
Table 17. Satisfaction of the respondents about the services of the staff members assigned
to the loan section
RESPONSE
FREQUENCY
PERCENTAGE (%)
Satisfied
94
94
Not satisfied
6
6
TOTAL
100
100
Perception of the respondents on the processing time for loans by the cooperative.
Eighty-seven respondents agreed that the processing time for loans by the cooperative
was just enough; eight respondents said that it was too long while five respondents said
that the processing time was too short (Table 18).
The results show that most of the respondents were contented with the time the
cooperative processed their loans from the filling of application until the releasing of
loans.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
27
Table 18. Perceptions of the respondents on the loan processing time by the cooperative
RESPONSE
FREQUENCY
PERCENTAGE (%)
Too long
8
8
Enough
87
87
Too Short
5
5
TOTAL
100
100
Perception of the respondents on the terms and conditions of the loans offered by
the cooperative. Table 19 shows the respondents’ perceptions on the terms and condition
of the loans offered by the cooperative. 86 or 86% of the respondents were satisfied with
the terms and conditions of the loans offered by their cooperative while only 11 or 11%
of the respondents were not satisfied. The result implies that most of the respondents
agreed with the terms and conditions of the loans which imposed by the cooperative.
Table 19. Satisfaction of the respondents on the terms and conditions of the loans offered
by the cooperative
RESPONSE
FREQUENCY
PERCENTAGE (%)
Satisfied
89
89
Not satisfied
11
11
TOTAL
100
100
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
28
Respondents’ Perception on Loan Repayment
Respondents’ perception on the reasons for paying their loans on time. Seventy-
one percent of the respondents claimed that paying loans on time is a responsibility that
should be done by any borrower. Forty-two of the respondents said to earn a good
reputation in the cooperative, 16 respondents said to be able to avail of higher loans, 24
respondents said for other members to have something to borrow and 10% of the
respondents, for the cooperative to be able to generate an income (Table 20).
Table 20. Respondents’ reasons for paying loans on time
RESPONSE
FREQUENCY
PERCENTAGE (%)
It is a responsibility of a borrower
71
71
To earn a good reputation in the
cooperative
42
42
To be able to avail of higher loan
16
16
So that members have something to
borrow
24
24
For the cooperative to generate an
income
10
10
TOTAL
163
163
*Multiple response
Perception of the respondents on whether loans from the cooperative should be
settled first before paying loans from other sources. Twenty-three respondents fully
agreed that payments should be made first for the loans in the cooperative before paying
loans to other sources. Sixty-eight agreed while only nine respondents disagreed (Table
21).
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
29
The results show that most of the respondents have positive perception that loans
from the cooperative should be given priority in terms of payment than the loans to other
sources. This confirms that the respondents have internalized the philosophy that
cooperative is owned, managed and controlled by the members thus, they prioritized their
payment to the cooperative before the others.
Table 21. Perception of the respondents as to whether loan payment should be prioritized
over loans to other sources
RESPONSE
FREQUENCY
PERCENTAGE (%)
Fully agree
23
23
Agree
68
68
Disagree
9
9
TOTAL
100
100
Perception of the respondents on the performance of the collectors of the
cooperative. Table 22 shows that most of the respondents had positive remarks on the
performance of the collectors of the cooperative. Twenty-seven respondents rated the
performance of the collectors as very good, 71 respondents’ rated good while only two
respondents gave poor rating to the collectors. The positive rating given by the
respondents to the collectors was due to the remarkable attitudes of the staff members
such as they were strict in implementing their collection policies, but they were courteous
in collecting, they had integrity and credibility, they maintained good rapport with the
borrowers and they maintained complete and accurate collection records.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
30
Table 22. Perception of the respondents on the performance of the collectors of the
cooperative
RESPONSE
FREQUENCY
PERCENTAGE (%)
Very good
27
27
Good
71
71
Poor
2
2
TOTAL
100
100
Respondents’ perception as to how accurate and complete record the recording
loan collection. Table 23 presents that 59 respondents said that the cooperative
maintained an accurate and complete record of the payments whereas 41 respondents said
sometimes.
The result reveals that majority of the respondents believe that the cooperative is
properly recording their payments and their records are properly kept at the office. On the
other hand, only few respondents said sometimes. According to them, they experienced
some instances wherein their loan balances in their own records do not jive with the
cooperative’s record. This happened when sometimes the staffs forgot to record
immediately their payments thus, they have to show receipts of their payment to correct
the discrepancy.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
31
Table 23. Perception of the respondents as to how accurate and complete their recording
of loan payments
RESPONSE
FREQUENCY
PERCENTAGE (%)
Always
59
59
Sometimes
41
41
TOTAL
100
100
Perception of the respondents on areas for improvement of the collectors. The
cooperative has three collectors. Table 24 shows the areas that the respondents perceived
should be improved among the collectors. Most (48%) respondents answered the staff
members should improve in the way they deal with the borrowers, 41 respondents said
they should do something in their strategies of collecting payment, 26 respondents said
about their character and 13 respondents answered about their recording of their
payments.
Problems Encountered by Member-Borrowers
That Affect Their Performance in Loan
Repayments
Table 25 presents the problems encountered by member-borrowers that affect
their performance in loan repayments.
Since majority of the respondents were farmers, most (54%) of their problem is
because of low prices of their produce. It is understood that when price of vegetables
goes down the farmers’ income is affected causing them not to be able to pay their loans
to the cooperative. Fourteen percent of the respondents said that they live very far from
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
32
the cooperative and there were no collectors going to their place. Since they live far, they
have hard time going to the cooperative to pay their loans especially when they are busy
in their farms. Another fourteen respondents said that the loan was not used wisely thus,
they could not generate income for the repayment.
Only few (5%) mentioned that the cooperative’s record does not conform with
their records and seven of the respondents mentioned that some of the officers and staff
members of the cooperative are not models to the member-borrowers since they
themselves had delinquent loans in the cooperative. Somehow, this influenced the
member-borrowers not to pay their loans also.
Lastly, ten respondents claimed that the term and conditions of their loans were
not properly explained to them.
Table 24. Perception of the respondents on the areas for improvements of the collectors
RESPONSE
FREQUENCY
PERCENTAGE (%)
Strategies in collection
41
41
Character
26
26
Dealing with the borrowers
48
48
Recording of payment
13
13
TOTAL
128
*Multiple response
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
33
Table 25. Problems encountered by the member-borrowers that affected their
performance in loan repayments
RESPONSE
FREQUENCY
PERCENTAGE (%)
Located far from the cooperative
14
14
Low prices of the produce
81
81
Cooperative’s record do not conform
with the member’s record
5
5
Some officers and staff set bad
examples
7
7
Lack on management skills on the
project
14
14
TOTAL
112
Respondents’ Recommendations for Improving
Their Attitudes and Perceptions on Loan
Borrowing and Repayment
Table 26 shows that 69% of the respondents recommended that the cooperative
must conduct regular information dissemination about loan policies, fifty five percent
said a continuous education for the member-borrowers on their duties and responsibilities
must be conducted regularly, fifty one percent of the respondents said that a regular
monitoring on the projects of the member-borrowers should be conducted to determine
whether they used the loans properly, forty seven percent of the respondents mentioned
that officers and staff members should always be good models in paying their loans on
time also, forty five percent of the respondents said that there must be rewards or
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
34
incentives given to the member-borrowers who pay their loans in advance or on time for
them to be encouraged. Moreover, thirty percent of the respondents said that staff
members should undergo further trainings on loan processing and collection.
Table 26. Recommendations of the respondents
RESPONSE
FREQUENCY
PERCENTAGE (%)
Conduct regular information
dissemination on the loan policies
69
69
The staffs should undergo trainings on
loan processing and collection
30
30
Regular monitoring on the projects of
the borrower
51
51
The officers and staffs should always
be good model by paying their loans
regularly
47
47
Conduct continuous education to the
55
55
member-borrowers on the duties and
responsibilities
There must be rewards or incentives to
the member-borrowers
45
45
*Multiple response
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
35
SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
Summary
The study was conducted mainly to determine the practices and perceptions of the
member-borrowers of Bad-ayan Multipurpose Cooperative towards loan availment and
repayment. Bad-yan Multipurpose Cooperative is engaged in various operations; but
credit operation is their main source of income.
The respondents of this study were the member-borrowers of the cooperative. A
total of 100 respondents were randomly selected from the list of the cooperative. A
structured questionnaire was used to gather the data and information needed. The data
were then tabulated and analyzed statistically with the use of frequency and percentage.
It was found out that most of the member-borrowers availed of agricultural loans.
Majority had already availed of loans from the cooperative more than thrice.
Concerning the practices of the respondents on loans availment, most of the
respondents were able to prepare project proposals and most consulted their family
members when they borrowed from the cooperative. Before filling –up the loan
agreement, most respondents mentioned they personally read and understood all of its
details. They also explained what responsibilities of their co-makers are. Most of the
loans of the respondents were actually used to the purpose intended for.
According to the respondents, borrowing from the cooperative is a way of
patronizing its services being offered. As to the character of the staff members assigned
to the loan section, most respondents gave positive remarks stating that staff members are
helpful and accommodating. Generally, the respondents were satisfied with the services
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
36
rendered by the staff. The time consumed by the cooperative in processing the loan is
perceived by most of the respondents as just enough.
On loan repayment, most of the respondents followed their mode of payment. In
paying, most respondents asked official receipts and kept them. They have their own
record of their payments also. When they could not settle in due time, most respondents
preferred to ask the cooperative to restructure their loans. On the other hand, the
respondents responded to the reminders or notice letters coming from the cooperative
promptly. As to their payments, most respondents brought them to the cooperative.
Regarding the perceptions of the member-borrowers on loan repayment, most
respondents said that loans must be paid since it’s a main responsibility of the member-
borrower and a means of earning a good reputation in the cooperative. When asked
whether loans from the cooperative should be settled first before loans from other
sources, most respondents agreed it. The performance of the collectors was given a rating
of good by most respondents and they recommended that they should improve their
dealings with the borrowers. As to the records of loans maintained by the cooperative,
majority of the respondents answered always accurate and complete.
The problems encountered by the respondents affecting their loan repayment are
low prices of their produce; they live far from the cooperative that they have a hard time
going to the cooperative; lack of skills to manage their projects and the cooperative’s
records do not conform with their records.
Finally, the respondents were asked for their recommendations on how to
improve their attitudes on loan availment and repayment. Their recommendations are as
follows: the cooperative must conduct regular information dissemination for their loan
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
37
policies; continuous education of the member-borrowers on their duties and
responsibilities; a regular monitoring on the project of the member-borrowers, officers
and staff should always be good models by paying their loans on time also; there must be
rewards or incentives given to the member-borrowers who pay their loans in advance and
the staff should undergo trainings on loan processing and effective collection.
Conclusions
The following conclusions are derived based from the results of the study:
1. From the various types of loan being offered by the cooperative, agricultural
loan is mostly availed of by the member-borrowers.
2. Most respondents prepared project proposal, and consulted their family
members when borrowing, explained the responsibilities of their co-makers,
asked technical advice from the cooperative, borrowed loans only from the
cooperative, and used their loan for the intended purpose.
3. Most respondents believe that paying the loan is a main responsibility of a
borrower. Moreover, the respondents have positive remarks on the character
and services of the staff assigned to the loan section. Most respondents are
contented also with the loan processing time.
4. Most of the respondents followed their mode of payment, kept their receipts
and recorded their own payments and responded promptly to the notices from
the cooperative. As to their payments, most respondents brought them
cooperative. Majority of the respondents said the cooperative always
maintained an accurate and complete record.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
38
5. Low prices of products and the far distance to cooperative were identified by
the respondents as the main causes of their poor performance in loan
repayment.
6. The recommendations to improve attitude and perceptions on loan availment
and repayment are: conduct of regular information dissemination on loan
policies, continuous dissemination education to the member-borrowers about
their duties and responsibilities, a regular project monitoring, officers and staff
should be good models, rewards or incentives to be given to those who pay in
advance and staff should undergo trainings on loan processing to be more
efficient.
Recommendations
The following recommendations are:
1. The cooperative should conduct the following:
a) Continuous information dissemination of their loan policies for all the
members to be well informed. The dissemination could be done during
meetings or activities by distributing brochures containing the loan
policies to the members or posting them on the cooperative’s bulletin
board to be accessible to all the members;
b) Preparation of project plan that will enable the member-borrowers to
use their loans properly on a feasible project that would make them earn
enough for the repayments of their loans;
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
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c) Seminars for the staff especially the collectors on strategies in
collecting, personality and values development and record keeping. These
seminars would somehow improve and develop the staff to become more
efficient and effective in discharging their functions.
d) Livelihood trainings so the member-borrowers will have alternative or
additional source of income especially if the price of their products goes
down. If they have other sources of income, they would have savings for
their loans.
2. Since the respondents have positive impressions on the character of the staff
and at the same time are satisfactorily contented with their services, the staff
members therefore recommended to maintain or further improve what they are
currently doing in the cooperative for them to be accepted by the member-
borrowers.
3. The members of the cooperative are scattered in the different barangays of
Buguias and one of the identified problem is the far distance of the members
from the cooperative that is situated at Baculungan Sur. With the large
number of borrowers, it is recommended that the cooperative would add to its
existing field offices that are located in Abatan and Bot-oan only. This would
facilitate the collection of the payments of the borrowers and at the same time
entice savings deposit among the people in the place.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
LITERATURE CITED
BLOCK, S.B. and HIRT, G.A., 1987. Foundation of Financial Management. Illinois,
USA: Irwin Homeland. Pp. 199
FAJARDO, F.R. and ABELLA. F. P. 1990. Cooperatives. Rex Printing Company Inc.:
Quezon City, Philippines. Pp 129.
MACARANAS, M.J. 1994. Manual Training Cooperative Management Staff.
International Labour Organization Cooperative. Entrepreneurs for Rural
Development: Quezon City, Philippines. Pp. 1, 18, 19
SACAY, O.J. 1985. Small Farmers Credit Dilemma. National Book Store Corporation:
Manila, Philippines. Pp. 2, 39, 41
TAGANAS, P. 1979. Repayment deficiencies of agricultural loan in Bontoc, Mt.
Province. BS Thesis. Benguet State University, La Trinidad, Benguet. Pp. 43
TAYLOR, D.O., 1970. Explanation of Purpose Behavior. Cambridge University: USA.
Pp. 78
WORLD BOOK ENCYCLOPEDIA. 2004.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
Appendix A
SURVEY QUESTIONNAIRE
I. General Information
Name (optional): _______________________________________
Address: ______________________________________________Age: ________
Sex: ________ Civil Status: ________
Address: ______________________________________________
Educational Attainment:
( ) Elementary
( ) Post College
( ) Secondary ( ) Vocational
( ) College ( ) Others (specify) _______________
Occupation: ___________________________
Type of loan you always avail in the cooperative? ___________________________
II. Attitudes and Perceptions on Borrowing
Please indicate your degree of agreement that comes closest to your feelings and
pertaining to your own action by checking the corresponding blank provided for.
Attitudes
1. Did you attend the Pre-Membership Education Seminar (PMES) conducted by the
Cooperative where the loan policies were explained?
______ yes ______ no
If no! Why? _________________________________________
2. Do you read and understand first the Loan agreements before filling –up and
submitting it to the cooperative for approval?
______ yes ______ no
3. Do you submit all the necessary requirements before filling your loan?
______ yes ______ no
4. Do you make plans where you will invest your loans before borrowing?
______ yes ______ no
If no! Why? ________________________________________
5. Do you make plans where you will source out your payments and how you will
pay your loans before borrowing? ______ yes ______ no
How? ____________________________________________________________
6. Did you strictly use your all loans in what you have stated in the loan agreements?
______ yes ______ no
If not all, where do you spend it?______________________________________
7. Did you explain first the responsibilities of your co-maker/s before getting them?
______ yes ______ no
8. Do you acquire loans in other lending institutions either private or public aside
from the cooperative?
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
______ yes ______ no
9. Do you consult first your family members or business partners before availing of
loans in the cooperative?
______ yes ______ no
10. Do you immediately use your loans upon getting it from the cooperative?
______ yes ______ no
If no, how many days/weeks /months that you handle before using it?
_______________________________________________________
11. Are you satisfied with the services of the staff assigned in the loans section in
your cooperative? ______ yes ______ no
12. Are you contented with the rates, mode/terms of payments of your loans?
______ yes ______ no
13. Are you contented with the time that your cooperative processes your loans?
______ yes ______ no
Perceptions
1. Membership in the cooperative is for the purpose of loaning only?
______ agree ______ uncertain ______ disagree
2. Borrowing from the cooperative is one way of patronizing it?
______ agree ______ uncertain ______ disagree
3. I borrow money for the sake of borrowing?
______ agree ______ uncertain ______ disagree
III. Attitudes and Perceptions on Paying Loans
Please indicate your degree of agreement that comes closest to your feelings and
pertaining to your own action by checking the corresponding blank provided for.
Attitudes
1. Do you pay your loans following the schemes you have agreed with the
cooperative?
______ yes ______ no
2. What makes or motivates you to pay your loans on time?
________ to be able to avail of a higher loan
________ to earn a good reputation in the cooperative
________ to help the cooperative lessen its delinquency
3. How do you pay your loans?
_________ go to the office personally
_________ wait for the collector
_________ give to any members who go to the cooperative
4. Do you wait for reminder or notice letters before settling your loans?
______ yes ______ no
5. What remedy/ies you undertake if you cannot pay your loans?
___________ resign in the cooperative and let the share capital be the payment
___________ sell properties
___________ go to the cooperative and ask for extension
___________ borrow outside
6. Are you satisfied when you pay your loans on time?
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
______ yes ______ no
7. If you cannot pay your loans, to whom do you usually ask for financial help?
_________ co-makers
_________ family members
_________ borrow from other lending institutions
Perceptions
1. There are always been a problem in the processing of loan in the cooperative
______ agree ______ uncertain ______ disagree
2. Satisfied with the rate, charges, and term of payment in the cooperative.
______ agree ______ uncertain ______ disagree
3. Pay early to help solve the cooperative financial situation and at the same time the
cooperative can lend to others.
______ agree ______ uncertain ______ disagree
4. Pay early to loan again.
______ agree ______ uncertain ______ disagree
5. Pay early so that I will be given a reward.
______ agree ______ uncertain ______ disagree
6. Pay early so that I will be a member in good standing of the cooperative.
______ agree ______ uncertain ______ disagree
IV. Problems Encountered by Members that Affect their Performance in Loan
Repayment.
Please check the problem you know that are encountered in the cooperative.
_______1. There are no field offices where the members located far from the
cooperative could pay.
_______2. There are no collectors who will regularly follow-up the payments of the
members.
_______3. Low income as a result of low prices of the products of the members.
_______4. The loan was used to other purposes.
_______5. Poor services of the staff.
_______6. Some officers are not model to the members in the sense that they are
also delinquent borrowers.
_______7. The Loan agreements are not properly explained and informed.
V. What would you recommend to the cooperative that would improve your attitudes and
perceptions on loan borrowing and repayment?
Please check the recommendation you like to be applied in the cooperative.
______Continuously conduct information dissemination especially on loan policies.
______The cooperative should be strict in implementing their loan policies to all
members.
______The staff should be trained on how to deal properly with the borrowers.
______The cooperative should have a regular monitoring scheme to the loans of the
borrowers.
______ The officers and staff should always maintain good relationship with the
borrowers.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
______ The officers should always be a role model by showing that they pay their loans
on time.
______The cooperative should give incentives that would encourage better performance
of the members.
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
42
Appendix A
Letter to the Respondents
Benguet State University
College of Agriculture
DEPARTMENT OF AGRIUCLTURAL ECONOMICS AND
AGRIBUSINESS MANAGEMENT
La Trinidad, Benguet
January 2007
Sir/Madam:
Greetings!!!
I am a fourth year student of Benguet State University taking up Bachelor of Science in
Agribusiness major in Cooperative Management. I am conducting my undergraduate thesis
titled, “Practices and Perceptions of Member-Borrowers of Bad-ayan Buguias Development
Multipurpose Cooperative Towards Loan Borrowing and Repayment”, as partial requirements
for graduation.
this connection, may I request a part of your time to answer the attached questionnaire.
Your kind assistance will enable me to complete all the requirements in due time. Rest assured
that all your answers will be kept confidential.
Thank you very much.
Truly yours,
FRANKLIN B. AGUSTIN
NOTED:
FLORENTINO B. LANDACAN
Adviser
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
43
Appendix B
Survey Questionnaire
I. General Information on the Member-Borrower
Name (Optional) _________________________________________________________
Occupation: _____________________________________________________________
What types of loan (according to purpose) have you availed of from the Cooperative?
______ Agricultural Loans
______ Commercial Loans
______ Industrial Loans
______ Salary Loans
______ Emergency Loans
______ others, pls. specify____________________
How many times have you availed of loans from the Cooperative?
______Once only
______ thrice
______ twice
______ more than thrice
II. Practices on Borrowing
Did you make a project proposal on where your loans should be used before borrowing at the
cooperative?
Yes _____
No _____
If no, why?
________lack of knowledge to do
________it is not required by the coop
________others, pls specify: _________________________________________
Did you consult your family members or business partners on availing of loans at the
cooperative?
Yes _____
No _____
When the cooperative gave the loan agreements to you, what did you do?
_________ I personally read it and understood
_________ I just filled-out the information and submitted to the cooperative
_________I let somebody to fill-out the information
_________I never read it
_________others, pls specify________________________________________________
Did you accomplish and submit all the loans requirements in the cooperative before they released
your loan?
Yes _____
No _____
If no, what are those requirements you have not submitted? __________________
Did you ask for technical advice regarding your project from the cooperative staff?
Yes _____
No _____
If yes, what had you ask? ________________________________________________
Did you explain the responsibilities of your co-makers or guarantors when you called them?
Yes _____
No _____
Did you use your loan for the purpose/s you stated in the loan agreement?
Yes _____
No _____
If no, why? _______________________________________________________
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
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Do you have loans from other cooperatives or lending institutions?
Yes _____
No _____
If yes, what are your reasons for availing of loans from other cooperatives/lending
institutions? _________________________________________________________
Upon releasing your loans, did you use it immediately in your project?
Yes _____
No _____
If no, why? ____________________________________________________
Do you make savings deposits and add your share capital in the cooperative as a security of your
loans?
_________always
____________sometimes
_________ never
III. Practices on Loan Repayment
Do you pay your loans following the mode of payment you have agreed with the cooperative?
_________always
____________sometimes
_________ never
How do you pay your loans?
_______ go to the cooperative personally
_______ through the collector
_______ give it to any member who goes to the cooperative
_______others, pls specify _______________________________________________
Do you ask for and keep your official receipts and other documents showing your payment of
your loan?
_________always
____________sometimes
_________ never
Are you maintaining a complete record of your payments?
_________yes
____________no
What actions would you undertake if you could not be able to pay your loans on time in the
cooperative?
______sell properties
______ask the cooperative to restructure the loan
______borrow from friends, neighbor or other cooperatives
______ask the cooperative to offset with the savings or share capital
______resign in the cooperative
_____others, pls specify: ____________________________________________
Do you give attention and respond promptly to the reminder or notice of your cooperative
regarding your payments?
_________always
____________sometimes
_________ never
Have you been exhausting all possible remedies just to be able to pay your loans in the
cooperative on time?
_________always
____________sometimes
_________ never
IV. Perceptions on Borrowing
Why did you borrow from your cooperative?
__________it is a way of patronizing the service of the cooperative
__________lesser interest rates and other fees
__________the staffs are friendly
__________the time of the processing the loan is short
__________the loan ceiling is higher
__________others, pls specify
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
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How do you describe the staffs who are assigned in the loan’s section of your cooperative?
a. _______ they are friendly
____not friendly
b. _______ they are courteous at all times
____not courteous
c. _______they are helpful and accommodating _____not helpful and accommodating
d. _______others, pls specify _______________________________
How do you rate the service of the staff ?
Yes _____
No _____
If no, why? ______________________________________________________
Do you agree/disagree with the following terms and conditions of the loans offered by your
cooperative?
Yes _____
No _____
What can you say about the time consumed by your cooperative in processing your loans?
_________ too long
_________ enough
_________ short
V. Perception on Loan Repayment
Why do you pay your loans on time?
______to be able to avail of a higher loan
______to earn a good record or reputation in the cooperative
______it is a responsibility of a borrower
______for the cooperative to generate an income
______so that other members have something to borrow
______to get a reward or incentive from the cooperative
______others, pls specify_______________________________________________
Do you believe that loans from the cooperative should be paid first before paying the loans from
other sources?
________fully agree
________agree
_______disagree
How do you describe your collector or person in-charge in the collection in your cooperative?
___ strict in implementing the policy in the collection ____ not strict in the collection
___ courteous in collecting
____ not courteous
___maintains integrity and credibility
____has no integrity and credibility
____maintains good rapport with the borrowers
____always maintains complete and accurate collection record
____others, pls specify: ______________________________________________________
Generally, how would you rate the collectors of your loans?
______ very good
_________good
________poor
What are the areas you recommend for the improvement of the staff in-charge in the loan
collection?
______strategies in collection
______character
______relationship with the borrowers
______recording of payments
______others, pls specify
Does your cooperative maintains an accurate and complete record of all your payments?
_________always
____________sometimes
_________ never
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
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46
VI. Problems Encountered by Member-Borrowers that Affect their Performance in Loan
Repayment
______there are no collectors who will regularly collect the payments
______there are no field offices where the borrowers could pay especially those who are located
very far from the coop office
______the cooperative’s record does not conform to the member’s record
______the term and conditions of the loans are not properly explained to the borrower
______low income because of low prices of the products of the members
______Some officers and staff set bad examples to the member-borrowers for they are
delinquents
______very poor services of the staff
______the loan was not used properly
VII. What would you recommend to the cooperative that would improve your attitudes and
perceptions on loan borrowing and repayment?
______conduct regular information dissemination on loan policies of the cooperative
______strict implementation of loan policies to all member-borrowers
______the staff in-charge in loans should undergo trainings on loan processing and collection
______regular monitoring of the loans of the member-borrowers
______officers and staff should always be good model by paying their loans regularly
______conduct continuous education to the member-borrowers on their duties and
responsibilities
______there must be rewards or incentives given to the member-borrowers who have good credit
record
Practices and Perceptions of Member-borrowers of Bad-ayan Buguias Development Multipurpose
Cooperative Towards Loan Borrowing and Repayment / Franklin B. Agustin. 2007
Document Outline
- Practices and Perceptions of Memberborrowersof Bad-ayan Buguias Development Multipurpose Cooperative Towards LoanBorrowing and Repayment
- BIBLIOGRAPHY
- ABSTRACT
- TABLE OF CONTENTS
- INTRODUCTION
- Rationale
- Statement of the Problem
- Objectives of the Study
- Importance of the Study
- Scope and Limitation of the Study
- REVIEW OF LITERATURE
- Loan Practices of Borrowers thatLed to Loan Delinquency
- Practices that can Contribute toCooperative Success
- Perceptions
- Loans
- Inability to Repay
- Problems in the Collection of Loans
- Definition of Terms
- METHODOLOGY
- Locale and Time of the Study
- Respondents of the Study
- Data Collection
- Data Gathered
- Data Analysis
- RESULTS AND DISCUSSION
- Brief Information on the Respondents
- Practices of the Member-Borrowers inBorrowing Loans in the Cooperative
- Practices of the Member-Borrowers inRepaying Loans in the Cooperative
- Respondents� Perception on Borrowingfrom the Cooperative
- Respondents� Perception on Loan Repayment
- Problems Encountered by Member-BorrowersThat Affect Their Performance in LoanRepayments
- Respondents� Recommendations for ImprovingTheir Attitudes and Perceptions on LoanBorrowing and Repayment
- SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
- Summary
- Conclusions
- Recommendations
- LITERATURE CITED
- APPENDIX