The Constraints and Barriers for Loan Distribution by Financing Institutions to Cooperant Members

Abstract

The purpose of this research is to know and analyze the condition of cooperatives through the capital factor, human resources, managerial aspects, passive members and socialization, public awareness, spoilage, and economic democracy, which strongly influence the barriers and effectiveness of lending cooperatives in Indonesia. The dependent variables are the main constraints of cooperatives in lending, whereas the independent variables are capital, human resources, managerial aspects, passive members and socialization, public awareness, spoilage, and economic democracy. In this research, descriptive analysis and the structural equation modeling test are the data analysis techniques that were used to measure the research instruments. The research samples used in this study consist of 203 cooperative management institutions in North Sumatra, Indonesia. The sampling technique used was the purposive sampling method. This study concludes that managerial factors, passive members and socialization, public awareness, lack of economic democracy, capitalization, and a lack of participation have a significant effect on the barriers and effectiveness of lending cooperatives.

The Impact of Small-Scale Oil Palm Plantation Development on the Economy Multiplier Effect and Rural Communities Welfare

“…According to Muda and colleagues, the progress of business entities in rural areas needs to be supported by the participation of the community and their members to avoid obstacles and ineffective lending strategies [44]. Results of research by Abdullaev et al [45], stated that developing business entities and economic institutions in rural areas is essential to provide digital services.…”