Problems of Cooperative and Solution Measures

Many problems and irregularities have arisen in cooperative Sector. These issues are as follows:

1. Giving priority to friends and relatives in loan distribution and other services.

2. Appointing family members to positions of authority.

3. Directors using deposit or savings funds for personal gain.

4. Investing in land and property instead of providing loans to members in need of funds.

5. Lending collected money to large businesses at high-interest rates instead of supporting ordinary people and members.

7. A single person holding positions in multiple cooperative organizations.

8. Not conducting financial audits of transactions.

9. Making investments outside the cooperative’s main area of operation.

10. Directors misappropriating funds and fleeing with the money.

11. Using the cooperative’s name for personal business activities.

12. Ineffective regulation and oversight of cooperative organizations.

 

These various problems and irregularities make it challenging to maintain the reputation of cooperatives. The main solutions to these problems are as follows:

1. Effectively implementing the Cooperative Act.

2. Completely discouraging investments and share sales outside the cooperative’s primary operations.

3. Arranging periodic inspections by regulatory bodies to ensure cooperatives are working according to principles, values and the law.

4. Providing education, training and information to cooperative members to enhance their skills and awareness.

5. Ensuring that cooperative members are active, capable, and aware.

6. Introducing provisions for financial crimes, similar to banking offenses for co operatives.