Savings and Credit Co-Operative Societies’ Impact on Poverty Reduction in Rural Tanzania: The Case of Mwanza and Tabora Regions

Abstract

The question on whether Savings and Credit Co-operative Societies’ (SACCOS) Services reduce poverty among members remains unsettled in the empirical findings in Tanzania. The study was conducted with aim to contribute to the on-going empirical discussions. Six SACCOS were purposively selected in Mwanza and Tabora rural areas. A total of 500 respondents were randomly selected whereby 200 were members and 300 were non-members. The study used a questionnaire and a key informant interview guide to collect quantitative and qualitative data respectively. Microfinance Poverty Assessment Tool (MPAT) and Propensity Score Matching (PSM) were used to analyse quantitative data. The qualitative data were analysed using thematic technique. The study found that non-members of SACCOS were poorer compared to members and that differences of poverty levels between the two groups emanated from SACCOS interventions. It is concluded that SACCOS’ services in the study area help to reduce poverty among members. The study recommends that Tanzania Co-operative Development Commission (TCDC), co-operative officers and Moshi Co-operative University (MoCU) to continue sensitise the rural communities so as to establish more SACCOS which will help to reduce poverty among rural residences.