Financial Viability of Establishing an Employees’ Credit Cooperative in a Local HEI

The primary objective of cooperatives is to help improve the living conditions of its members. The financial vulnerability experienced by everyone particularly employees had challenged them to find sources to secure immediate funds/cash. Easy access to credit therefore is a concern for employees. This study aims to determine the financial viability of establishing an employees’ credit cooperative in a local HEI that will provide employees easy access to credit and immediate source of funds. It investigated the prospective membership profile of the proposed credit cooperative. Likewise, it determined the project cost of putting up a credit cooperative. Finally, it analyzed the financial viability of establishing an employees’ credit cooperative using the STEPS indicators. A descriptive-survey research design was utilized to achieve the objectives of the study. One hundred forty-six employees of a local HEI and seven employees of an existing credit cooperatives were the respondents of the study. In choosing its respondents, this study used purposive sampling tool. The findings conclude that most of the employees of a local HEI are interested to be regular members of the proposed cooperative during the first year of its operations, preferred to avail salary loans and emergency loans once a year with an amount of more than 15,000. Almost all employees will contribute share capital and deposit to savings account regularly. The project cost of putting up a cooperative based on the historical information of existing cooperatives include pre-operating cost primarily composed of capital expenses in the form of computer with printers as well as prepaid insurance, operating cost which were mostly administrative expenses, working capital in which cooperative had low working capital funding gap and minimum share capital requirement/paid up capitalization in accordance with the prescribed rate of Cooperative Development Authority (CDA). Lastly, the proposed employees’ credit cooperative is financially feasible in terms of stability, turnover ratio, efficiency, profitability, and structure of assets.