Islamic Cooperative Societies and the Efficiency of Financial Intermediation in Ife East Local Government, Osun State, Nigeria

Abstract

The study investigated the relationship between cooperative societies and financial intermediation efficiency in Ife east local government, Osun State, Nigeria. The broad objective of this study is to examine the extent at which cooperative societies in Ife East Local Government achieved their financial intermediation role. The specific objectives are to examine the relationship between the total deposit and total credit of Munislam Welfare Fund cooperative society and to investigate the relationship between the total deposit and the total credit of Al-Irshad welfare fund cooperative society.The study used regression analysis method to achieve the stated objective. The data for this study was obtained from the annual financial report of the selected cooperative societies in Ife East Local Government, Osun state, Nigeria. It was revealed in Credit supply equation I that there was a positive correlation and significant relationship between the total deposit and total credit of Munislam Welfare Fund cooperative society. It was also discovered in Credit supply equation II that there was a positive correlation and significant relationship between the total deposit and total credit of Al-Irshad welfare fund cooperative society. The study recommends that Cooperative Societies should foster a higher level of liquidity in order to increase its ability to grant loans and advances to their members for productive purpose. The study also recommends that Cooperative societies should effectively utilize mobilized deposit in order to ensure the efficiency of financial intermediation.