Basic Principles and Highlights of Issues in Cooperative Societies

What is a Co-operative Society?

As the name suggests, it is a business venture which runs on the cooperation of and the ownership by its customers who re-invest in the community it served. An autonomous association of persons voluntarily cooperating for mutual social, economic and cultural benefits

Evolution of Cooperative Movement

The cooperative movement in India owes its origin to agriculture and allied sectors.
It was an attractive mechanism for pooling the meagre resources for solving common problems relating to credit, supplies of inputs and marketing of agricultural produce

In 1904 the government enacted Cooperative Credit Societies Act, 1904 a more comprehensive legislation called the Cooperative Societies Act was enacted.

Contd..
Under the Montague-Chelmsford Reforms of 1919and under the government of India act, 1935, cooperatives were treated as a provincial subject. The provinces were authorised to make their own cooperative laws. After India attained Independence in August, 1947, cooperatives assumed a great significance in poverty removal and faster socio-economic growth. With the advent of the planning process, cooperatives became an integral part of the Five Year Plans. The item "Cooperative Societies" is a State Subject under entry No.32 of the State List of the Constitution of India.

Contd..
Micro finance: As a way to help cooperatives and individual businessmen to grow and prosper their business, making the community financially self-reliant simultaneously, Micro Finance came up as a boon for both society and banks to leverage on the power of cooperatives in impacting the society.

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Basic Principles
Voluntary and open membership Democratic Member Control Member Economic Participation Autonomy and Independence Education, Training and Information Co-operation among Co-operatives Concern for Community

Laws governing Cooperatives

As

per the preamble act, the cooperative society act facilitates the formation of cooperatives for the promotion of thrift and self help and for the person with limited means. Therefore, cooperative societies can be estimated for the purpose of credit, production or distribution.

Laws governing Cooperatives

Agricultural

credit societies must be with unlimited liability Unlimited societies, however, are not the best form of cooperation for agricultural commodities. A society can be formed with at least 10 members, age above 18, all the members residing in same town,same tribe, class, or occupation unless registrar directs otherwise.

Laws governing Cooperatives

A

registered society is a corporate body with perpetual succession and common goal.it can hold properties, enter into contracts,defend suits and other legal proceedings and to do all things necessary for the purpose of its constitution. Each society is managed by a committeecommittee means the governing body of a registered society to whom the management of its affair is entrusted.

Advantages
Promotion

of Savings

Self-

Help Mutual-Aid Overcoming the constraints of agricultural development Creating conducive environment for small and cottage industries

Advantages
Soften

class conflicts and reduce social cleavages Reduce the bureaucratic evils and follies of political faction.

Issues faced by Cooperative Societies

Dormant membership Lack of active participation of members in the management of cooperatives Over-dues in cooperative credit institutions Lack of mobilization of internal resources and over dependence on government assistance Political interference and over politicization hampers their growth.

Contd..

predominance of vested interest of a particular person or a class for whom such a cooperatives were formed.

Setbacks of Cooperative Societies

Poor infrastructure Lack of awareness Lack of quality management Neglect of professionalism Restricted coverage Over-dependence on government Lack of strong human resources policy Non-conduct of elections

Programmes in India
National Agricultural Cooperative Marketing Federation of India Ltd. (NAFED) National Cooperative Union of India (NCUI) National Consumer Cooperative Federation (NCCF) National Cooperative Development Cooperation (NCDC) National Labour Cooperative Federation (NLCF) NDDB, IFFCO

Contributors

Kezia Mehul Kadambari

References
http://www.ncui.coop/welcome.html Research paper by Miss Banishree Das Problems and Prospects of the Cooperative Movement in India Evolution of Cooperatives in India Government of India

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