Upscaling Rural Financial Institutions: From Informal Groups to a Formal Institution

 

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SG leaders workshop on cooperative formation

The process of registration into a formal primary cooperative started with the consent given by U Aung Phyu, Director-General of the Department of Cooperatives after the meeting with the team of PlaNet Finance and CDA led by Ron Bevacqua, PF Project Director.

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Ron Bevacqua PF Project Director and U Aung Phyu, Director-General, Department of Cooperatives

As of October 30, there were 105 savings groups organized with 1,136 members and a combined total savings amounting to US$42,435. The registration is the last in the three-stage cooperative development framework used by PlaNet Finance in the Project:

First Stage: Savings group formation
Using a method called Rapid Savings Mobilization Technique (RSMT), savings groups are formed from among the villages in the project area. Savings groups are determined by various elements such as members (not less than 5 and not more than 20 per group), leaders (chairperson, treasurer, and collector), savings policies, regular meeting, and simple recording for financial transactions. The main objective of the savings group is to develop the habit of savings.

Second Stage: CONSOLIDATION
This phase is a transition phase where the leaders of the savings groups are made to know each other. Using a method called Informal Group Consolidation Technique (IGCT), leaders of the group interact in a general meeting once in a month to know each other, share information how they manage their groups and discuss other development issues including the formal registration into a cooperative.

Third Stage: COOPERATIVE FORMATION
The final stage is the formal registration of the consolidated savings groups into one big cooperative. The registration will follow the standard procedures required by the Ministry of Cooperatives. To ensure the strength of the cooperative, a Cooperative Formation Courses (CFC) is conducted for the leaders of the savings groups.

The general assembly of the cooperative will be held on November 20 (Friday), where  organizational will e discussed and the first set of the Board of Directors  selected. After the registration, continuous capacity-building activities will be implemented for the officers and management team of the cooperative to enable them to cope with the work requirements to serve thousands of its members. A wide range of financial services will be designed to meet all the requirements of the members and the public.

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