@book{707,
	author = {Aliguyon, Clestina B.},
	title = {Factors associated with loan repayment performance of the dar and non-dar assited cooperatives in Ifugao/},
	publisher = {Nueva Vizcaya State University,},
	year = {2004},
	address = {Bayombong:},
	note = {Statement of the Problem

	The study primarily aimed to assess the factors associated with the repayment performance of the DAR and non-DAR assisted cooperatives in the Province of Ifugao. There were 46 respondents from the DAR-assisted and 46 from the non-DAR assisted, totaling to 92. The respondents were randomly selected. Descriptive statistics such as percentages, means and rank were employed to describe the nominal data.

	The t-test was employed in comparing the two groups of cooperatives where the observations/responses were of the parametric type. In assessing the factors associated with repayment performance, correlation analysis using backward stepwise regression was used to relate the input with the output variables.

Findings

	Profile of the respondents. Forty one (41) percent of the DAR-assisted belong to the 30-39 age bracket and 39 percent of the non-DAR assisted cooperatives belonged to the age bracket of 40-49. Most of the respondents of both groups were females accounting for 70 percent and 67 percent respectively. Eighty three (83) percent and 78 percent, respectively were married, 36.95 percent and 59 percent, respectively were college graduates; 54 percent of the DAR assisted group were farmers and 37 percent of the non-DAR assisted cooperatives were government employees. As to their annual income for year 2001, 41 percent of the DAR-assisted cooperatives had 47.82 percent of the non-DAR assisted cooperatives had above. P15,000 and P 51,000 and

	Profile of the cooperatives studied Each twenty nine (29) percent of the DAR-assisted cooperatives were organized in 1995-1996 and 1997-1998, respectively and each 14 percent were organized in 1990 and below, 1991-1992, and 1993-1994. Forty three (43) percent of the non-DAR assisted cooperatives were organized in 1990 and below, and each 28.57 percent in year 1991-1992 and 1993-1994 respectively. As to their registration to the Cooperatives Development Authority (CDA), 57.13 percent of the DAR-assisted cooperatives were registered within 1995-1996 and each 28.57 percent of the non-DAR assisted cooperatives were registered within 1991-1992, 1993-1994 and 1995-1996, respectively. Fifty seven (57) percent and 71 percent respectively were multipurpose types of cooperatives with 29 percent of both groups operating as credit cooperatives.

	On the services being offered by the cooperatives to their members, 100 percent of the DAR-assisted cooperatives offered emergency and production loans, and 100 percent of the non-DAR assisted cooperatives offered emergency, providential, and production loans. Under the consumer ventures of the cooperatives, 57 percent and 86 percent respectively of both the DAR and non-DAR assisted cooperatives engaged in retailing

	As of December 2001, forty three (43) percent of the DAR-assisted cooperatives had a total asset of P 1,100,000-5,000,000 while 43 percent each of the non-DAR assisted cooperatives had an asset of P 20,100,000 and above, and P1,100,000-5,000,000 respectively. Under the DAR-assisted cooperatives, each 28.57 percent had a total membership of 51-100, 151-200, and 201-500 respectively. Under the non-DAR assisted cooperatives 42.85 percent had a total membership of 1,100 and above, 28.57 percent had 201-500 and each 14.29 percent had a total members of 151-200 and 501-1,000 respectively.

	Forty three (43) percent of the DAR-assisted cooperatives have a total net income of P 50,000 and below, and each of the 14.29 percent had an annual income of P51,000-100,000, 101,000-200,000, 501,000-1,000,000 and P1,100,000 and above respectively. Under the non-DAR assisted cooperatives, each of the 28.57 percent had an annual income of P 50,000 and below, 101,000-200,000 and 1,100,000 and above respectively. Each fifty seven (57) percent of the DAR-assisted cooperatives had been in operation for 6-10 years and 11-15 years respectively. Under the non-DAR assisted cooperatives, 43 percent operated for 6-10 years, 29 percent for 21 years and above, and 14.29 percent for 11-15 years.

	Loaning Policies. The cooperatives offered emergency loan, providential loan, production loan, special loan and salary loan. On their loaning policies, 43 percent of both the DAR and non-DAR assisted offered their loanable an emergency loan ceiling of P1,000.00 per borrower.

	On providential loan, 57 percent of the DAR-assisted cooperatives offered up to twice the share capital of the member-borrower and 42 percent of the non-DAR assisted cooperatives offered a loan ceiling up to 2.5 times their share capital. On production loan, 57 percent of the DAR assisted and 43 percent of the non-DAR assisted based their loanable amount at twice the share capital. On special loan, 29 percent of the DAR-assisted cooperatives based their ceiling on the amount approved by the funding agency while 29 percent of the non-DAR assisted cooperatives based their ceiling on the amount applied for. Seventy one (71) percent of both groups do not offer special loans. On salary loan, each 14.29 percent of the DAR-assisted cooperatives based their ceiling on the amount applied for and twice the share capital respectively, while 28.55 percent of the non-DAR assisted cooperatives pegged their ceiling at twice the share capital with each 14.29 percent basing their ceiling on the amount applied for, 2.5 times the share capital, 5 times the gross pay, and 10 times the net pay respectively. Seventy one(71) percent of the DAR-assisted groups and 14 percent of the non-DAR assisted group do not offer salary loans.

	On the policy on maturity date per type of loan, 71 percent of both groups had 1 month for emergency loan, 43 percent and 86 percent for both groups, had 1 year on providential loan and production loan. On special loan, 14.29 percent each of the DAR-assisted cooperatives based their maturity date on 3 years and the project duration. Twenty nine (29) percent of the non-DAR assisted cooperatives based their maturity mainly on the project duration. On salary loan, 14.29 percent each of the DAR-assisted group set the maturity on 1 year and 5 months, and 29 percent each of the non-DAR assisted group set it at 24 month and 10 months respectively. Seventy one (71) percent and, 14.29 percent of both groups do not offer salary loan.

	On the style or scheme of loan repayment, 71 percent and 86 percent, respectively of both groups required their borrowers to pay their emergency loans at the cooperatives' office while 29 percent and 14 percent sent collectors to where the borrowers were. On providential loan, 86 percent and 71 percent of both groups respectively asked their member-borrowers to pay their loans at the cooperatives' office. Twenty (29) and 14 percent sent their loan collectors to where the borrowers were. On production loan, 100 percent and 86 percent of both groups respectively required their member-borrowers to pay their loans at the cooperatives' office while 14 percent of the non-DAR assisted group sent collectors to where the borrowers were.

	On special loan, 29 percent of both groups required their member-borrowers to pay their loans at the cooperatives' office and on salary loan, 29 percent and 86 percent, respectively did the same.

	On interest rates, 28.57 percent each of the DAR-assisted cooperatives offered 1 percent, 2 percent, and 3 percent per month for emergency loans and 71 percent of the non-DAR assisted cooperatives offered 1 percent per month on the same kind of loan. For providential loan, 71.42 percent of the DAR-assisted cooperatives offered 15 percent per annum and 57.13 percent of the non-DAR assisted group offered 12 percent per annum. On production loan, 57 percent of both groups offered 12 percent per annum. On special loan, 29 percent of the DAR-assisted group offered 18 percent per annum and each 14.29 percent of the non-DAR assisted group offered 11 and 16 percent per annum respectively. For salary loan, 29 percent and 57.13 percent of both groups respectively offered 12 percent per annum.

	On penalties on delinquencies, 57 percent of both groups imposed 2 percent per month of the unpaid amortization for emergency loan, and 57 percent and 71.42 percent for both groups respectively imposed 2 percent per month for providential loan and production loan. On special loan, 14.29 percent of both groups imposed 2.5 and 3 percent per month respectively. On salary loan, 29 percent and 57 percent, respectively imposed 2 percent per month.

	Repayment Delinquencies for year 2000 and 2001. The highest delinquency rate incurred in the DAR-assisted cooperatives were on special loans with an average percentage of 4 percent in 2000 and 4.1 percent in 2001.

	This was followed by the providential loan with an average percentage of 3.5 percent in year 2000 and 3.3 in year 2001. Under the non-DAR assisted cooperatives, the delinquency rate was high on providential loan with 40 percent in year 2000 and 20 percent in year 2001; followed by special loan with 15 percent in year 2000 and 20 percent in year 2001.

	On the scheme of loan repayments, 78 percent and 54.35 percent, respectively of the borrowers of both groups paid their loans on a monthly basis, and 78.26 percent and 54.35 percent, respectively paid their amortizations on time.

	On the borrowers' reasons in paying their loans on time, 80.43 and 56.52 percent, respectively of both groups stated that it was to avoid the fines and penalties provided in their cooperative's policies; and on the part of the delinquent borrowers 60 and 71.43 percent respectively revealed that their failures to pay their loans on time were due to the absence of cash on time. On the issue on awareness of member-borrowers with the due date of their loans, 100 and 91.30 percent of both groups respectively stated that they were aware of the due date of their loans.

	On what type of loan was availed of and paid on time, 41 and 38 percent respectively of both groups revealed that it was the providential loan which they had availed and paid on time with another 27 and 31 percent respectively stating that it was production loan. On what type of loan was availed of and paid on time to comply with the cooperative's loaning policies, 38 percent of the DAR-assisted cooperatives revealed that it was the providential loan and 33.34 percent of the non-DAR assisted cooperatives revealed that it was production loan.

	On which of the loaning policies caused the borrowers to pay their loans on time, 46 percent of both of the DAR and non-DAR assisted cooperatives revealed that it was on fines and penalties.

	Recommended measures to improve repayment performance. On what seminars were deem necessary for both the DAR and non-DAR assisted cooperatives, seminar on delinquency control ranked number 1, followed by cooperative management seminar, then policy formulation and cooperative ownership seminar.

	In the correlation analysis using backward stepwise regression, it was found out that personal factors such as age, gender, educational attainment, civil status, occupation and income have no significant relationship to the repayment performance of the respondents at 5 percent level of significance for both the DAR and non-DAR assisted cooperatives.

	On the loaning policies implemented such as loanable amount per type of loan, maturity per type of loan, scheme or style of loan repayment per type of loan, interest rate per type of loan, and fines and penalties per type of loan, the correlation analysis showed no significant relationship at 5 percent level of significance in both the DAR and non-DAR assisted cooperatives. While there were positive contribution of some of the above factors, said contribution to the repayment performance of the respondents were not significant at 0.05 probability value.

Conclusions

Based on the results of the findings, the following major conclusions were drawn:

1.	Majority of the non-DAR assisted cooperatives have higher assets and membership and that they have been in operation for a longer time than the DAR-assisted cooperatives.
2.	Higher rate of delinquency occurred in providential loans in both the DAR and non-DAR assisted cooperatives hence majority desired for the conduct of a seminar on delinquency control in their cooperatives.
3.	More borrowers of the DAR-assisted cooperatives have paid their loans on time than their counterpart in the non-DAR assisted cooperatives.
4.	More of the borrowers of the DAR-assisted cooperatives have positive values and attitudes paying their loans on time, so that others will also borrow, avoiding fines and penalties, maintaining a good record in the cooperative, and complying with the policy of the cooperative.
	Most of them were aware of the due date of their loans and they voluntarily go to the cooperative to pay their loans.

5.	The personal factors such as age, gender, educational attainment, civil status, occupation and income, and the loaning policies such as loanable amount, maturity date, scheme or style of loan repayment, interest rate and fines and penalties have no significant relation to repayment performance in both of the DAR and non-DAR assisted cooperatives under the 5 percent level of significance.
6.	The DAR and non-DAR assisted cooperatives have no significant difference in their level of repayment performance at 5 percent level of significance.

Recommendation
Based on the findings of the study, this recommendation is hereby forwarded:

1.	All concerned government and non-government agencies involved in rural development should extend technical assistance to organized cooperatives so that these peoples' organizations will be strengthened as vehicle for economic growth in the communities.
2.	A similar study may be conducted using other independent variables.
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