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The question is an application question. Most candidates could not identify the type of cooperative form by the staff of the ministry.

Also, some candidates stated the features of the cooperative as the advantage, vice versa.

The expected responses are.

1. The cooperative society to be formed is a Thrift and Credit Society


2. Features of Thrift and Credit Society


1. There is continuity which means that the death of a member will not bring the society to an end.


2. Members are entitled to one vote each irrespective of the number of shares owned.


3. The liability is limited to the shares held by members.


4. Profit is shared among members based on patronage.


5. The objective of the society is to generate funds which would be given as loans to members.


6. The management of the society is by a committee of elected members.


7. Capital is raised from members’ contributions.


3. 1. Advantages of Thrift and Credit Society
   
   
   2. The society encourages saving habits among members.
   
   
   3. Members of the society have equal powers as all are entitled to one vote each during decision making.
   
   
   4. It enables members to have access to funds which could be difficult to obtain from other financial institutions.
   
   
   5. The death of any member cannot bring the society to an end. It has continuity.
   
   
   6. It improves members’ standard of living as commodities such as cars, furniture and housing are made available to members on credit.
   
   
   7. Members benefit from training and seminars which are organised by the society.
   
   
   8. It grants loans to members.
   
   

Disadvantages of Thrift and Credit Society

1. There is usually difficulty in recovering loans which may hinder the operations of the society.


2. Mismanagement/embezzlement of funds by elected members which may lead to the collapse of the society.


3. There is great reliance on the contributions of members as well as repayment of loans. Some committee members lack management and

technical skills to run the society thereby leading to the collapse of the society.