Cooperative Banks

Cooperative Banks

1.Cooperative Banks are registered under the State Cooperative Act or the Multi State Cooperative bank with the Registrar of Cooperatives. Their main regulator is the State Government (or Central Government in cases of the cooperative banks operating in more than one State). The organizational structure and management set-up of cooperative banks is based on cooperative principles. It is observed that these banks are not professional in management as in the case of commercial banks.

2.Cooperative Banks are classified into Primary Cooperative Banks (Urban Cooperative Banks), Short Term Cooperative Banks (Agriculture Cooperative Banks) and Agriculture and Rural Development Bank (Land Mortgage Banks)

3.Cooperative banks’ size of assets/liabilities is much smaller as compared to commercial banks. Cooperative banks operate on ‘no profit no loss’ principle of cooperation and commercial banks operate with profit objective (for the shareholders).