Reaching for the Cloud: Embracing digital channels in cooperative societies within Africa

July 1, 2020
4 min read

By Obong Idiong

The Covid-19 pandemic has fueled the migration of group interactions to online channels. Virtual meeting platforms such as Zoom, Skype, Microsoft Teams and Google Meets have become an essential element of modern culture, enabling family members, professional colleagues and other people groups to interact safely amid the outbreak of the highly contagious disease. Additionally, there is a growing appetite for virtual channels for investments, commerce and recreation. According to the African Union Commissioner, Amani Abou-Zeid, the “Covid-19 crisis has become the biggest catalyst for digital transformation and has moved digitization from a niche market into mass adoption”.

As a voluntary association of individuals with common economic and social interests, cooperative societies in Africa should embrace the trend and take deliberate steps to migrate their operations to digital channels. Cloud and related technology provide an opportunity for cooperative societies to not only improve the user experience of members and ease administration but to deliver additional services efficiently.

The adoption of digital technology holds the key for cooperatives in Africa to fulfil their potential as agents of economic growth. In Kenya, for example, the Ministry of Industry, Trade and Cooperatives estimates that cooperatives account for over 30 percent of GDP, compared to a much smaller fraction of Nigeria’s GDP. Technology has played an important role in organizing the activities of cooperatives in nations where they are making a significant economic impact.

Cloud computing is a technology that is very relevant to cooperatives today. It refers to the delivery of computing services such as servers, storage, databases, networking, software and analytics over the internet and can be used to deliver faster and more flexible services to a variety of users. Service providers create cloud computing systems to serve common business or research needs.

These solutions are generally designed to support large customer or user numbers and are therefore an ideal solution for cooperative societies that seek to operate more efficiently. Adopters typically pay only for the cloud services they use and can lower their operating costs, enhance security, run infrastructure more efficiently and scale operations. One way to achieve this cost efficiency is by partnering with digital solutions companies.

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By adopting cloud technology, cooperatives can revolutionize their operations in several ways. The collection and organization of members’ data on a cloud platform allow cooperatives to create financial accounts efficiently. This endears the cooperative to financial service companies, making them more willing to offer loans and other services to cooperatives. Sadly, many cooperatives in Africa struggle to provide financial accounts and data on the contribution of members. As a result, they are unable to take advantage of financing opportunities such as the loans currently being offered by the various Government’s in these countries through various intervention schemes.

Technology is also changing how members relate with each other. Participation at meetings, voting and notifications can now be done virtually, saving time, resources, increasing participation and making engagement more convenient for members. Also, the adoption of digital technology opens up a new approach to customer service and customer experience. Members are now able to access information about their contributions and receive personalized services on the go.

The use of digital methods to organize the operations of cooperative societies also enables a range of prescriptive and predictive analysis that are otherwise not possible without data. The managers of the cooperative can analyze the membership and peculiar needs and circumstances of members on a platform made possible by cloud computing technology.

For example, through data mining, cooperative societies can more accurately ascertain the products and services that could interest their members. Also, through the processing of data and the creation of appropriate algorithms, the cooperative is more likely to improve member satisfaction by anticipating their needs and product preferences. Data processing can also be a valuable tool in risk management concerning designing rules around the provision of loans/credit to members. The power of data can only be truly unleashed today when organizations adopt digital methods in the provision of their services and the management of their operations.

Sponsored Article Image 3The application of digital technology to drive innovation in the activities of cooperatives is a growing trend across the world. Credit unions in the United States are offering services via online and mobile channels to young adults. Millions of credit union members in Asia are being connected to digital financial tools. Digital technology is not only supporting the efficient distribution of loans to credit union members but enabling peer-to-peer rental of farming and other equipment in many countries. Given a large number of cooperative societies in Africa, there is significant scope for these groups to enhance their impact on society, better serve their members, and navigate the current public health concerns.

Another reason why cooperatives should embrace digital technology is the threat of the potential disruption of their businesses by outsiders. The success of Uber shows how the business of “taxi service cooperatives” across the world can be disrupted. Cooperatives in Africa need to wake up to the threat of technology to their business and embrace it before advancements in technology render them irrelevant in the future.

While access to digital tools and affordable broadband connectivity remains a challenge, the World Economic Forum calls for “localizing digital content and services” through; new models of investment in digital infrastructure; digital skills development; digitization of public services and creation of technology offerings tailored towards SMEs, all of which create further opportunities.

Covid-19 has created uncertainties across economies around the globe. However, this dire outlook creates new opportunities, to do things differently and harness new growth opportunities.

Obong Idiong is the CEO of Africa Prudential Plc, an NSE listed digital solutions company with a particular focus on Nigeria’s capital market.

This article is a Brand Press post. Brand Press is a paid service for brands that want to reach Techpoint Africa’s audience directly. Techpoint Africa’s editorial team doesn’t write Brand Press content. To promote your brand via Brand Press, please email

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