Kathmandu, 5 April: Across the country, citizens’ total savings in cooperative institutions amount to approximately NPR 11.25 trillion. According to the National Cooperative Authority, around NPR 11.25 trillion has been collected as savings (deposits) and NPR 9.23 trillion has been invested as loans across nearly 32,000 operating cooperatives.
The “Status Report of the Cooperative Sector” published by the Authority shows that about 10.9 million citizens are currently affiliated with cooperatives. A total of 90,265 people have gained direct employment. “Over seven decades, the cooperative movement has become an important foundation and medium for the country’s socio-economic mobilization. In a country with a predominantly rural economy, the role played by the cooperative sector in raising the basic living standards of people is commendable,” the report states.
Although the cooperative sector has been recognized in the Constitution as an important pillar of the economy, its qualitative and quantitative expansion has not been satisfactory. Various complexities have also developed in this sector. The report concludes that different types of problems and challenges have emerged over the seven decades of cooperative development, leading to the current situation.
“Some cooperatives have failed to return depositors’ savings, there has been no significant progress in recovering loans issued to members, there are weaknesses in adhering to cooperative values and principles, there is a wide gap between the spirit and practice of cooperatives, and due to the lack of quality cooperative education, attraction and responsibility toward cooperatives have not increased,” the report states. “Due to growing problems and complexities, there is even a misconception that the entire cooperative sector has become problematic. In this situation, the Authority needs to be more active in reducing risks in the cooperative sector in the coming days.”
Government data show that the number of cooperatives, which was less than 1,000 when the Cooperative Act 2048 (1991) was introduced, has now reached 32,965. Among these, around 14,000 are estimated to be savings and credit cooperatives. Experts believe that the number is actually higher, as some sectoral and multipurpose cooperatives are also conducting savings and credit transactions.
“The overall cooperative sector across the country is estimated to have mobilized around NPR 12.68 trillion in capital through shares and savings, provided direct employment to around 90,000 people, and included more than 10.9 million members,” the report states. “However, there is a need to ensure reliable methods and sources for collecting accurate and regular data related to cooperatives.”
Among 22 problematic cooperatives, 13 have illegally issued loans totaling NPR 21.37 billion. Eighteen cooperatives that have come under public scrutiny have issued loans worth NPR 32.40 billion. Of this, six cooperatives have issued NPR 6.85 billion in loans to individuals and entities associated with Gorkha Media Network. In total, 31 cooperatives (18 + 13) have issued loans amounting to NPR 53.78 billion.
Additionally, eight problematic cooperatives have invested NPR 2.73 billion, while 18 cooperatives under public scrutiny have invested NPR 159.39 million. Altogether, NPR 2.88 billion has been misappropriated in the name of investment.
Over the past decade, 669 individuals have been arrested by police, while 1,540 remain absconding. Most of them are wealthy and influential individuals.
