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Impact of cooperative principles in the Ecuadorian popular and solidarity financial sector

Abstract:

Savings and cbkp_redit cooperatives are part of the popular and solidarity financial sector, which must be governed by cooperative principles as part of their own identity and ideology of social equity. The objective of this article was to analyze the financial impact of applying these principles. The study has a cross-sectional and explanatory quantitative approach. Financial information was obtained from the savings and cbkp_redit cooperatives of Ecuador; and, in addition, a survey was applied to the members of said cooperatives, to assess compliance with the cooperative principles. Data analysis was performed using regressions to assess the financial impact of the data. The results show that the non-performing loans ratio is lower, the greater the democratic participation of its members and the liquidity improves when a greater open membership is shown to new partners. On the other hand, the profitability index and the capital adequacy decrease when self-management and independence activities generate a heavy cost structure for services and those assumed by cooperatives. It is concluded that the application of the cooperative principles can generate positive or negative impacts on the results, depending on the way how their application is managed.