KATHMANDU, NOVEMBER 26: The government has decided to disallow the registration, service expansion, and establishment of service centers for cooperatives.
The Ministry of Land Management, Cooperatives and Poverty Alleviation (MoLMCPA) lately urged authorities concerned to implement the decision taken by the cabinet to suspend the registration, service expansion, and permission of service centers related to cooperatives, particularly to those meant for saving and credit services, until new provisions are made.
According to the Spokesperson at the MoLMCPA Ganesh Prasad Bhatta, recent developments in the cooperative sector are likely to have adverse effects on the overall financial sector and it was decided to put restrictions on saving and credit cooperative business through the Cabinet decision on November 9.
According to the MoLMCPA, there is a concerning trend among many saving and credit cooperatives in significant numbers across the country to accept huge deposits and invest in high-risk sectors. Similarly, the cooperative sector is grappling with a financial crisis as members and depositors face challenges retrieving their savings.