This research is an attempt to bring to light the effectiveness of credit administration in co-operative credit society in various co-operative societies based in Enugu South Local Government Area of Enugu State. This research has five chapters with introduction. It tells about the meaning of co-operative credit society, credit administration, the statement of problem, objectives of study, significance, scope and limitation as well as definition of some co-operative and general terms. Chapter two, took a look a related literature review of authors about credit co-operative and credit administration, its weakness, effect of credit administration and its importance as well as problems associated with it. Chapter three, talked about method use by the research in gathering information i.e the may the research questionnaires was carried out and investigation method. Chapter four, was about the presentation of data, the interpretation and analysis of the data obtained. It also talked about response of respondence. Chapter five, conclusion, pinpoints the major problem, which inhabit the full success of credit administration and same suggested solution which are necessary to convert some of these problem.




Agricultural credit in Nigeria dates back to the 1930s but organized credit to farmers did not start until 1972 when the Nigerian Agricultural and Co-operative Bank (NACB) was established. The awareness of the serious decline in agricultural production was probably partly responsible for the establishment of the bank. The NACB is not the only financial institution which provides agriculture credit. Prior to the establishment of NACB, agricultural credit scheme was operated by some agencies such as the Ministry of Agriculture’s supervised credit scheme, agricultural credit co-operation, co-operative thrift and loan schemes, farmers multi-purpose co-operative societies. Most of these institution were not effective sources for strictly agricultural credit. There was a lot of evidence that creditors borrowed money for agricultural but diverted it to other ventures.

Again, credit was often extended to only favouries and scarcely to genuine small-scale farmers. Besides they could not meet the collateral and equity contribution requirement, a situation that compelled a significant proportion of the farmers to seek for other sources of credit.

According to Idachaba quoted from Cardoso, (1987) a survey carried out showed that 58% of farming related borrowings was from family and friends, 24% from private money leaders, 15% from macharts and only 3% from institutional sources. However, while family and friends charged little or no interest. Organized credit facilities for Nigeria’s rural faming population. Would reduce the dependence on sources other than the formal financial houses.

It is against this background that the researcher is to investigate how credit will be effectively administered in co-operative enterprises. This will enable us to identify the major problem associated with credit administration and seek solution to these problem to ensure continued existence of the co-operative.


Co-operative society mobilize credit to their members through the savings of members. It has been observed that they are inefficient in mobilizing and utilization of credit. Many problem lead to this ineffective mobilization of credit. They are:

–                     Inadequate fund for loan purpose

–                     Inefficient management of loan

–                     Faulty loan policy which may sometimes emphasis credit worthiness of borrowers and not viability of projects.

–                     Credit operation are mere money activities without proper organization procedure and planed systematic arrangement.

–                     Absence of regular monitoring and supervision of loans.

The above problems need to be solved for effective performance of co-operatives.


The situation of co-operative is nothing to write home about, if co-operative should continue at this rate, they will wind up.

In view of the above, solution have to be designed for these problems:

–   Therefore, the objective of the study is to find out the various societies existing in the area under review.

–   To find out various problems being encountered by these co-operative which lend to hinder their effective and efficient performance as agents of credit.

–   Finally, to make recommendation and suggest  probable solution that will enable these societies overcome these problem.


This study will assist the loan committed managers in their decision making, as a concern credit policy and management of credit in form of proper assessment of loan application. Proper supervision of credit, and evaluation of project proposals. It will help the management to see the need to employ professional staff and lastly, this study or findings will be of educational importance to the various universities, polytechnic and students of co-operative department in the various school.


The researcher will limit this study to effective administration of credit in co-operative enterprise in Enugu South Local Government Area. The researcher intends to find out the available source of fund to co-operative as well as the financial problem of co-operative. The researcher will also fund out the process of credit administration and some factors militating against credit administration.


In the course of accomplishing this study, the researcher was faced with the following limitations.

–   Finance

–   Time

–   Lack of data


For clarity of purpose, elimination of confusion of any kind and the proper understanding of this study. They following definition of terms are necessary.


Administration or management is the art of attempting to achieve stated objective by directing human activities in the production of goods and services.


this is an economic system in which individual are free, singly or collectively, to own capital and undertake economic activity within the a framework of social legislation designed to protect the interest of individual designed to protect the interest of individual (Hanson 1974:218).

–        CREDIT

credit is financing directly or indirectly, the expenditure of other against future, repayment, such lending or financing is direct when say, a bank extends an overdraft facility to a customer who then uses it. It is indirect when a trader or producer supplies goods on credit (David .W. Pearil).


For the fact that credit is very important in every business activity. Therefore, the study is focused on funding relevant solution to the following research question.

–   What is the purpose of credit administration in co-operative societies in Enugu South L.G.A?

–    How effective is credit administration to co-operative in Enugu South L.G.A?

–  What problem are encountered in the administration of credit in co-operative societies and what are the solution to these