Dar Es Salaam, Tanz - SNHU Academic Archive - Southern New ...

28The firs t schoo l of though t argue s that , ther e ar e a numbe r o f reason s wh y som epromoters choos e no t t o appl y th e cooperativ e concept , including : Th e cooperativ ehistory is a tainted one because in the past the system was highly politicised, resulting inmismanagement, poor governance and in many cases, collapse; all at the expense of thepoor rural farmer. Evidence shows that it is a long-term (and thus expensive) process torebuild the confidence of the rural people with regard to the SACCOs-concept.The Tanzanian legal system for formal financial institution s does not specifically cate rfor cooperative s o r cooperativ e banks , i.e . the y ar e no t integrate d i n th e Ban k ofTanzania (BOT). Cooperatives of all kind are registered under the Cooperative Act, andsupervised by the Cooperative Department throug h the Distric t Commissioners offices(DCOs). Promoting agencies have to be creative and innovative to avoid the potentialproblems associated with a dual supervision system when creating cooperative bankingnetworks.Having a legal entity is an advantage i n theory, but in practice, the legal system is stillunder-developed, and commercial courts of law are in a pilot phase only. Furthermore,inventive ways have been found to take informal groups to court.The other school of thought, however, argues that in principle, the cooperative system isstill an effective way to community ownership and community development. One onlyneeds to address th e weaknesses i n the system . As one promoter put it: "If your child