Abstract:
Members of primary savings and credit cooperative societies can use savings to lower risk,
manage costs, and achieve financial objectives. This study aimed to identify the factors that
affect the saving practices of members of primary savings and credit cooperative societies. It
employed both descriptive and explanatory research designs with both qualitative and
quantitative methods. It used proportional, purposeful, and simple random sampling techniques,
both primary and secondary data collected from primary SACCO members. The primary data
was gathered by distributing survey questionnaires, and 309 questionnaires were returned by
sample respondents from a total of 321 kaffa zone selected woredas. Both descriptive and
inferential statistical analyses were used to evaluate the data, and the collected data were
analyzed through descriptive statistics, correlation, and multiple regression analysis to estimate
the causal relationships between the socioeconomic, household-related, and institutional factors
and the saving practices of members of primary savings and credit cooperative societies. The
study found that eight factors affecting savings, such as length of membership, interest rate,
service delivery, credit access, financial awareness, income, age, and level of education, have a
positive and significant influence on annual savings. Family size and household head also have a
positive effect, but are not statistically significant. Among the independent variables, annual
income has the highest value of the Beta coefficient (β=.239, p=<.000) and has the highest
influence on the level of annual savings of members. This study found those explanatory
variables explained 78.1% of the variation in annual savings, while 21.9% may be explained by
other variables. It was recommended that government organizations and non-governmental
organizations prioritize raising awareness and encouraging members to save, borrow, and repay
loans on schedule to increase member confidence and encourage savings.
