Role of Cooperatives In Economic Enhancement

Robert Owen is considered as the father of the co-operative movement which was instigated in England. It has been 174 years since the co-operative movement was started. Co-ops are a form of tactical organization and it is the pulse in the economic development of the nation. Its enterprises organize the local people & improve their skills to perfect the local resources. The co-ops first-come self-help groups, mutual societies, aiming to ease deprivation and suffering and to enable people to protect against illness and the effects of old age citizens. Thus, it is the main tool for local development. Furthermore, co-operative can encourage the scaling up of local successes and connect local efforts to national and international levels. As well as it supplies a platform for interaction among the members that builds trust and makes close which helps in planning local development competently and raises social unity. It is a group of people looking for common economic, social and educational growth, and avoiding the exploitation of the weak by the strong besides a co-operative is an autonomous association of persons united voluntarily to meet their common economic, social and cultural needs and aspirations through a jointly-owned and democratically-controlled enterprise.

The growth of co-operatives faces many weaknesses brought by other organizations’ competitive pressure, which can present a serious threat to the cooperative’s survival in the long run. It cares to mitigate the precarious conditions & survival through successful movements. Co-operatives are organizations with great potential and possibilities for blending social change. It helps the community’s members on doing work by join efforts in various fields are guided by the principles of equality, mutual benefit, and mutual respect.

Co-operatives are both a natural form of human interaction and a modern social movement. A successful co-op is an example to others; one with problems could be inviting helpful comments. Performance information enables one co-op to compare its performance with other similar co-ops, and a valuable source of important information. The manager should plan and set aims. The organization needs to be functional and the results depend on the style of management. The application of co-operative principles is to share with others who are in need. Its reserves belong to its members and this must be said openly. The purpose of the coop is to satisfy a community’s needs by supplying high-quality goods and services at a reasonable price.

I think a co-op is a platform that makes it closer to the members of the cooperatives. It helps to enable to the cooperative society providing various types of skills, such as how to save income, income generates literacy program, awareness program, banking concept, community-based program, human right programs, social welfare program, children orientation program, women empowerment program, social welfare program & many more. It upkeeps the relationship among the members of the cooperative & enables their position as well as builds up ability. It helps those who do not have able to very much. Co-op is also a bank that lends the credit at a minimal rate of interest that is cheaper than local Sahu / Mahajan. It supports the community’s members from the local money lenders where they are suppressed to have loans at a high rate of interest.

Thus co-op, a membership organization, is the milestone for the community’s members. Imagine if there is no coop in the society what will you do? Because it is a friend of daily life that supplies tangible support in day to day life. Coop is aiding to those people who are struggling for hunger-free and fighting every day to fulfill basic needs that are food, shelter & cotton. It supplies the skills to those people who are excluded & are corrupted by the local Sahu / Mahajan. Co-ops belong to its members and are controlled by its members for the benefit of its members. Co-operatives, like most businesses and organizations, trust people working together towards a common goal to be successful. It works best when the idea and development of the business are led by the group that will be involved with the co-operatives. Moreover, developing ability in members or shareholders over time will help ensure the co-operative has access to the human and leadership skills required to continue over the long term, and potential for raising capital when needed. The real picture of Nepal is that the poor get poorer and the rich get richer.

Co-operative Principles
• Voluntary, Open Ownership. Open to all without gender, social, racial, political, or religious discrimination
• Democratic Owner Control. One Owner, one vote
• Owner Economic Participation
• Autonomy and Independence
• Education, Training, and Information
• Cooperation Among Cooperatives
• Concern for The Community
• Self-help & Mutual Help
• Each for All & All for Each
• One Man, One Vote:
• Distribution of Surplus:
• Cash Trading:
• Limited Interest on Investment:
• State Control:

Co-operatives are most fruitful when they are created on good governance, a clear understanding of purpose, and a potential market. It plays a key role in the economy of the nation. I cogitate the coop covers the almost village of our country. It accesses to the exploited classes fulfilling in their basic requirements.

Coop means “with” & operatic means “to work” Thus cooperative means “working together”. In the context of Nepal, about eighty percent working population of the country is dependent on agriculture & its allied activities for livelihood. There is no other way except for the cooperative way. Hence, we can say that we cannot imagine life without co-operatives. It is an instrument of economic development, particularly in rural areas. Hence the Government should get priority to the cooperatives to make a sound economy.

The cooperative sector is one of the main partners of the economy. The co-op plays a very significant role because it is an organization for the poor, illiterate & unskilled people. Co-ops are also a financial organ of the national economy. The financial sector is set for always covered by risk thus it is to be run under the rules & regulations strictly. It is a voluntary association of persons who work together to promote their economic interest as well as works on the principle of self-help & mutual help. Commercial banks, Development banks, Finance Company & Microfinance are not able to function its financial activities in those areas, but cooperatives are functioning smoothly.

I think co-operatives are platforms which join the members of the local societies & help to the members on how to save income & expenditure in the productive sector. So, therefore, cooperative is the lifeblood for the emerging of the financial sector of the nation. It makes a bubbly role to get handier & intimacy to the community’s members & makes the sound relationship among the members. The main aims of the cooperative are to keep up the position of the members supplying them various services like credit, education, skill, and many more.

The constitution of Nepal has declared the country of a federal democratic republic with seven states. After restructured into 753 local level municipality including 481 village municipalities, 246 municipalities, 13 sub- metropolises, and 4 metropolises; in these entire sectors, the cooperatives are activating its economic function with competently and aid to the nation to build the financially sound position. By aiding the co-operatives, people can improve their working conditions and the quality of their lives. Different forms of co-operatives tackle different kinds of problems. What they have in common is that they serve their members and the community, aiming to develop the quality of life for their members. As member satisfaction is vital to any co-operative. It supplies tangible support to its stakeholder as well as the nation-building in the economic sector. Co-ops organization works to supply self- help & mutual help among the coop members and is controlled by the members.

According to the NEFSCUN, 6 million people are already affiliated in approximately 34,512 cooperatives and more than 60,517 people are employed directly in the sector of cooperatives. The coop sector is fully related to financial transactions thus it has a great challenge & risk to run smoothly & competently in the competitive market. The market is going up aggressively day today applying the latest & modest technology & technique. To run pragmatically of any institution is a very great challenge. It is not easy to run & command the cooperative smoothly that we expected.
No financial transaction is set up out of the members of the coop. Thus, it is an organization where an almost financial function is done within the registered members only.

Nepal is the least developed country. In 2019, the GDP in Nepal was at around 94.38 billion international dollars. The cooperative has ample role to carry on the GDP. It is the lifeblood for those communities’ people who are living in the deprived sector. It supports to the excluded people on their basic needs. It helps in minimizing the role of Government in the sector of finance. Co-op concerns for community and assistances to create quality life & supply better reliable & efficient services at a reasonable cost. It supports to find a way to improve their precarious economic situation. Co-operatives among the people have existed since ancient times and it has always been associated with the survival of mankind.

When the co-operative makes failure, If the members of the cooperatives do not follow the rules & regulations of the cooperatives they break up the financial discipline as a result a co-operative begin to centralize around a few individuals like boards or managers, shareholders may feel disengaged or excluded from a business in which they are an owner. This can lead to unexpected purposes and tries at unfriendly redirection. It creates an undetected gap on their shareholders or members. Boards may also be uninformed because of insufficient information from their management team. Board members should have the necessary skills to manage the activities of their management teams and to evaluate the information passed on to them & must check the cash flow of their cooperative continuously. Without efficient cash management, no business can survive at all. The Board members must check the information that is passed on to them by management. Bad management cannot step up. Bad credit control leads to write-offs and losses and may even sink a cooperative. Good credit control, on the other hand, improves the cash flow and releases capital for the purchasing of more stock or investment in some other aspect of the cooperative’s activities. Hence the Board of Directors must watch the capital requirements regularly and keep a healthy balance between the borrowed capital and equity (the cooperative’s resources, made up of reserves and the share capital paid by members of the cooperative). It is always better if a cooperative focus on its core business.

In the context of Nepal Co-ops is the pillar of the financial sector to enhancement the nation on sustainable development. The role of co-ops is incomparable to others. But financial disciplinary action is most to slickly build up and to get the remarkable output as per the requirements of stakeholders. It provisions a lesson that how to organize & work together among the members. Furthermore, it is a milestone in enhancing the cordial relationship among the stakeholders. There are core strategic issues in the management of the cooperatives for the evolving nation. It has been playing a crucial role in strengthening the relationship among the members and deliveries the skills those who lose their jobs due to various circumstances. There is no simple way of financial activities except co-ops in the remote areas. Co-ops are one of the most prolific & potential sectors which are the main part of economic development. Several factors are touched by the co-ops only. The very development orientation has been based on a sound economy. It is the obligatory tool for economic growth in Nepal. In the market of co-ops, there is much competition, but quality service is what makes a product stand out. Co-ops are more effective tools for the economic development of the nation. Thus, Co-ops are for stability, prosperity, and inclusive development. -+

Government of Nepal publicized for 2077/78 F/Y budget Friday, May 2020 where highly highlighting to the sector of cooperative. Cooperative has been working in a different sector: poverty alleviation, education, good governance, social development, and natural resource management in the entire nation. Thus, 3 billion 60 crores budget is released to disbursement for microcredit financial institutions through cooperative to empower marginalized & vulnerable people. This allotted budget is to be managed to those youths who are fighting against poverty & hand to mouth problem. Youths who are skilled, but they are unemployed. If More than 2 lakhs youths are employed in a different sector, then they create added 2 lakhs youths for employment, gradually it supports strengthening the mobility of the youths & passive manpower. Hence It is called that cooperatives one of the pillars of the three-pillar economic policy.