Namibia Savings and Credit Cooperative

Proposed Formation of a Primary Savings and Credit Cooperative

23 August 2012

A cooperative is a group of people acting together to ◦ meet the common needs and aspirations of its

members, ◦ sharing ownership and ◦ making decisions democratically.

Cooperatives are not about making big profits for shareholders, but creating value for customers

What is a cooperative?

There are two types of cooperatives namely in Namibia as per the Cooperatives Act of 1996:

1. service cooperative – owned and managed by the people who use its services; and

2. workers’ cooperative – owned and managed by people who work in the business.

The Act further stipulates that a service cooperative must also enter into at least 51 per cent of its transactions with its members.

Types of Cooperatives

Marketing and supply cooperatives

Consumer cooperatives

Housing cooperatives

Savings and Credit cooperatives

Types of Service Cooperatives

The Namibia Consumer Protection Group is proposing the establishment of the Namibian Savings and Credit Cooperative.

The S&C Cooperative will act as a financial institution, and have the specific objectives to encourage savings and provide loan services.

Namibia Savings and Credit Cooperative

a) promote the economic and social interest of its members by providing effective services to its members according to sound business principles;

b) have non-discriminatory voluntary membership;

c) be democratic and controlled by its members;

d) entitle every member to have one vote – regardless of the number of shares owned;

e) provide services be primarily to members;

f) limit the dividends so most profits are kept for the functioning of the cooperative; and

g) provide ongoing membership education.

Objectives

Members must be◦ at least 18◦ a citizen of Namibia, or ordinarily resident of

Namibia

A primary savings and credit service cooperative shall be formed by at least a seven members. The cooperative shall be governed by its by-laws.

Establishing a Cooperative

These by-laws include information regarding the name, address, type of cooperative, objectives, nature of business and place of business and other information as stipulated by the Act.

  In addition the by-laws will include information

on the liability of its members – in the case of the proposed Savings and Credit Cooperative the liability shall be limited.

By-laws of the cooperative

At least 7 members present

Elect formation committee of at least 7 members

Formation Committee shall elect a Chairperson, Secretary, and Treasurer

Minutes must be kept

Formation Process

The committee shall◦ Convene meetings to advise prospective

members◦ Prepare the by-laws◦ Compile a list of its prospective members◦ Estimate share capital◦ Prepare a feasibility study◦ Prepare estimated Income and Expenditure, and

Cashflow Forecast

◦ Prepare Founders Meeting

Functions of the Formation Committee

Sign the Register of Attendance

Elect 7 members to the Board

Board shall then meet to elect ◦ Chairperson◦ Secretary◦ Treasurer

Appoint CEO

Actions To Be Taken

Convene Founders meeting to accept◦ Proposed by-laws◦ List of prospective members◦ Feasibility study and financials◦ Written declaration◦ Register of members

Elect◦ First Board and Supervisory Committee

Next steps