We will be discussing the History of the Cooperative Society in Nigeria which dated back to 1993. however, before the inception of the modern cooperative society in Nigeria, Nigerians have known and practiced the art of coming together in designated groups (eg Age groups, extended family meetings, women unions, etc) to make monetary contributions to meet their present and future needs.
“An autonomous association of persons united voluntarily to meet their common economic, social, and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise,” the International Cooperative Alliance (ICA) defined a cooperative society in its 1995 statement of cooperative identity.
History of Cooperative Society in Nigeria
People have recognized the importance of cooperating to increase their success in hunting, fishing, gathering food, creating shelter, and meeting other individual and communal requirements since the dawn of time. These examples of unofficial cooperation were forerunners to the cooperative company model.
Cooperatives in the 21st century
The beginnings of today’s cooperatives may be traced back to England’s Industrial Revolution. Workers were obliged to buy food on credit from merchants who paid excessive prices for commodities that were frequently of low quality in the first part of the nineteenth century due to exceedingly severe working conditions.
Cooperative ventures were widespread at this time, but none were effective until 1844 when the Rochdale Equitable Pioneers Society was founded by 28 people.
They founded a cooperative store at 31 Toad Lane in December 1844, selling only five items: oatmeal, butter, flour, sugar, and candles. They vowed to offer “purest provisions, giving full weight and measure” to its members.
The Rochdale Pioneers set lofty aims for their cooperative, including selling food in the store, purchasing homes for their members, manufacturing goods needed by their members, and providing jobs for those who were unemployed or underpaid. They were not the first to try to organize a cooperative, but they were the first to manage one successfully.
They created a set of operating guidelines to manage their cooperation in order to avoid the mistakes committed by previous groups. These principles include democratic voting by members (one member, one vote),
Individual members have limited equity ownership shares due to open membership and the provision of equity by members.
Net earnings are distributed to members on a per-user basis.
Cash-only trading, limited dividends on equity capital, and a responsibility to educate
There’s no unusual risk assumption here.
Political and religious neutrality, as well as membership equality
There is no discrimination based on gender.
The ICA 1995 Statement of Cooperative Identity was founded on these concepts, which are now internationally recognized as the seven cooperative principles.
7 Principles of Cooperation
History of Cooperative Society in Nigeria: Traditional Nigerian society has long had cooperatives in the form of informal savings societies such as “Esusu” and “Ajo.”
“Esusu” is a fund to which a group of people with a common interest contribute an agreed-upon fixed amount of money, which is then handed over to a treasurer. Members take turns using the money, allowing for a member in desperate need of a loan or advance. The loans have no interest attached to them.
Individuals give certain amounts of money on a daily basis to the “Ajo” collector, who collects the money. Contributors get their complete savings, minus one day’s contribution, at the end of each month.
The Agege Planter’s Union, founded in 1907* by approximately 400 cocoa producers, was the first recognized traditional cooperative.
The modern cooperative was first introduced to Nigeria in 1926 when the Ministry of Agriculture in Sir Graeme Thomson’s colonial government recognized and reorganized the cocoa producers’ cooperatives of Agege Planters Union and Egba Farmers Union in the cities of Abeokuta and Ibadan into marketing cooperatives to drive the sales of their produce.
The Nigerian government, on the other hand, commissioned C.F Strickland, a former British Cooperative Registrar in India, to research and report on the sustainability of cooperatives in Nigeria in 1933. In 1934, he submitted a report to the government, which was accepted.
As a result of the enactment of The Cooperative Societies Ordinance of 1935, the cooperative movement was formally established, and public funds were voted for the first time for the encouragement of cooperatives. This statute marks the beginning of Nigeria’s contemporary cooperative society.
E.F.G Haig, the Registrar of Cooperatives, registered the Gbedun Cooperative Produce and Marketing Society Limited in August 1937, and the Ibadan Cooperative Cocoa Marketing Union in February 1937. Nigeria now had 48 cooperative societies.
The federal constitution of 1952 gave regional governments the right to legislate on cooperative issues, decentralizing cooperative governance in Nigeria. The Western Region Cooperative Society Statute No. 6 of 1953 was the first regional cooperative law enacted in the United States.
The Nigeria Cooperative Societies Act (NCSA) 2004 of the Federal government and several State governments’ Cooperative Societies Laws (CSL) exist side by side to this day.
It’s worth noting that, under the doctrine of covering the field, whenever a state cooperative law’s provisions clash with the NCSA, 2004, the state cooperative law’s provisions are nullified to the extent of their incompatibility with the NCSA.
Due to the difficulty of cooperatives obtaining loans from commercial banks, the Western Regional Government established a cooperative bank, the Cooperative Investment Trust Fund, to support cooperatives’ operations. In 1995, the bank amalgamated with four other banks Prudent Bank, EIB, Bond Bank, and Reliance Bank, to establish Skye Bank Plc, with assets in the billions of naira (now Polaris Bank Plc).
Similarly, the Eastern Regional Government founded the Cooperative and Commerce Bank in 1961 as a Private Limited Liability Company to provide financial assistance to cooperative organizations, among other things. The bank became a public firm in the 1990s, with several state governments arising from the erstwhile Anambra and Imo states becoming minority shareholders. After 37 years of operation, the bank closed in 1998.
In the 1970s, secondary unions known as Cooperative Financing Agencies (CFAs) were formed in response to the difficulty of obtaining financing.
The Federal and State Governments, through budgetary appropriations and loans from the Nigerian Agricultural and Cooperative Bank, were the primary sources of funding for the CFAs (NACB).
The NACB was founded on November 24, 1972, as a National Agricultural Credit Institution, and began operations on March 6, 1973, as the Nigerian Agricultural Bank Ltd. (NAB). It changed its name in 1978 at the request of the Nigerian government.
This was done to emphasize its commitment to agricultural development through cooperative promotion and finance. The Nigerian Agricultural Cooperative And Rural Development Bank were formed in October 2001 when the Federal Government merged it with the People’s Bank of Nigeria and the risk assets of the Family Economic Advancement Programme (FEAP) (NACRDB).
In October of 2010, the NACRDB was renamed Bank of Agriculture Limited and rebranded. Its mission is to provide microfinance to individuals and organizations involved in the agricultural value chain, such as cooperative societies. It is also responsible for building capacity in the areas of cooperatives, agricultural information systems, and technical assistance and extension services.
The National Apex Organization of Cooperative Societies in Nigeria, the Cooperative Federation of Nigeria (CFN), was founded in 1944. The Rochdale Centenary Conference was held at Glover Hall Lagos from August 8th to 10th 1944, and the organization’s first General Meeting was conducted there. Around 500 delegates from 400 cooperative societies and unions from the Southern Provinces, British Cameroons, and Northern Nigeria’s major cities attended the conference.
In 1967, the CFN became a legal entity. It is a member of the International Cooperative Alliance, which is the world’s umbrella organization for cooperative societies, as well as the Nigerian State Cooperative Federations. The CFN has worked with the Nigerian government, as well as local and international cooperative stakeholders, to promote the cooperative movement in Nigeria* since its inception.
Conclusion: History of Cooperative Society in Nigeria
It’s inspiring to see how far the current cooperative movement has come since its humble beginnings in 1935, encompassing the whole Nigerian economy and positively improving Nigerians’ socioeconomic life.