Kathmandu, September 10
The Department of Cooperatives has barred cooperative federations from conducting new savings and lending transactions, implementing a provision of the Cooperatives Act that restricts such activities by federations.
The department issued the directive in accordance with Section 50(9) of the Cooperatives Act, 2017. District, provincial and central cooperative federations currently involved in savings and credit activities have been given three years to either jointly establish a cooperative bank or merge with an existing cooperative bank.
The federations have also been instructed to prepare and publish clear plans for returning members’ savings and recovering loans within the three-year period.
They must complete their audits and general assemblies by the end of Poush of the current fiscal year and determine their assets and liabilities. They must also prepare a strategic plan for either establishing or merging with a cooperative bank and submit it to the Office of the Cooperative Registrar and the National Cooperative Regulatory Authority after approval by their boards and general assemblies.
The government amended the Cooperatives Act through an ordinance in April and later converted the amendment into a bill, which was endorsed by the House of Representatives in June.
The department has directed federations to focus on cooperative development, member education, training, marketing, good governance and policy advocacy while complying with regulatory requirements.
