Credit management and profitability in cooperative unions in Uganda
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The study was carried on “Credit Management and Profitability of Cooperative Unions in Uganda looking BCU Mbale”. The study was guided by the following specific objectives: to establish the effect of credit policy and procedures on the profitability, to examine the effect of credit information on profitability and to establish the effect of credit analysis on profitability of BCU The study adopted a case study research design were qualitative and quantitative approaches were used. A sample size of 36 respondents was chosen from the total study population of 40 respondents. Both simple random and purposive sampling techniques were used in selecting the respondents for the study. Both primary and secondary data were used in the compilation of this research. Primary data was gathered using questionnaires, interviews and text books, organizational journals, magazines and internet was contacted for secondary data. The study found out revealed that credit policy and procedures helps organizations in ensuring that organizations make profits. This was reached by an average mean of (4.10) which interpreted to be very effective, On the effects of credit information an average mean of (3.60) which very effective was got implying that credit information is important in helping organization avoid discrepancies on trade credit and therefore make profits. The research also revealed that there credit analysis is essential in identifying credit worthy customers and organizational capacity to offer credits. This was seen by an average mean of (4.0) which was very effective implying. From the study findings the following recommendation were made. BCU should ensure the development of adequate and efficient credit policy for their organizations. In order to achieve the desired results, the organization should consider their mission, the native of their businesses and their business environment before setting up credit policy and the credit policy should not be disregarded after it’s created, BCU should also intensify efforts to engage the efforts of factoring agents. They will reduce the incidence of bad debts losses and other associated costs of credit, the organization should monitor, review and adjust credit policy from time to time considering the nature of their business and mission, BCU should increase the rate of credit sales to trustworthy customers only despite the fact credit sales is a marketing tool to maintain or expired sales.